Lastly, rumor has it Bitmain is culling it's S1 inventory and discontinuing S1 production in favor of the S2.
thats my assumption. We are at the point where the size and weight of the S1 to run at 2w/gh is unneccessary. The S2 is much denser hashing speeds and is rack-mountable (the most common S1 complaint).
presumably/hopefully there is an S3 coming in May that will be able to use a smaller chip design to further improve speeds and density
Well the S2 is just an S1 with more chips per GH/s and the chips slowed down to get the W/GH down.
So unless they decided that the S1 chip is the end of the work for them, they certainly must be working on a next gen chip ...