Re: ANN: BITMAIN has Tested Its 28nm Bitcoin Mining Chip BM1382
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So if the S1 Upgrade path cost $200
How can that possibly be? Where are the $300 worth of parts you would be saving?
Arbitrary numbers I pulled out of my ass to make a point. But, what does it matter? Why does the actual cost of the saved components have to actually be $300? They're valued at whatever BITMAIN decides to value them at and the rest of us just have to deal. Aluminum heatsinks aren't cheap, nor is shipping a huge chunk of metal across the globe in 2-3 days.
Edit: Aside from that you (BITMAIN) save on the fan + grill, antenna lead, control board, ribbon cables, end brackets, assembly labour, packaging material, hardware, HSC, etc.
I'm glad somebody pointed these out. The upgrade path for s1 to s3 is actually quite viable if BITMAIN factors in the money they save by not shipping all those parts around the world in their pricing of " upgrade kits for s1 to 3" .
Shipping alone would save them good chunk of money instead of shipping whole unit, they need to just send hashing boards and probably controller boards for it. Maybe even this way, there is less chance of getting any kind of damage during shipping since it weigh less
also theoretically the tax should be less since it just parts rather a whole unit 
overall a lot of possibilities for s1 to s3 if again BITMAIN price it right, otherwise as other have mentioned just selling it somewhere would be most logical path