M2M and the Internet of Things

I was asked recently about M2M pricing structures -- specifically, how carriers (generic and specialized) tend to price low-bandwidth and/or low-transfer cellular data plans, and what they tend to do about the physical modem or other devices they sell (or otherwise offer) to provide service. Here's my answer:

First, I would definitely not recommend relying on prepaid plans and the like, or consumer-grade wifi hotspot hardware (though consumer and "pro" grade cell modems are usually exactly the same from the carrier). In reasonable quantity (100 devices or so) a fair deal right now (2013) might be 10MB/month for about $15/device. The carrier will typically pool the data, thus what you'd really have is 1,000MB that could be distributed across your devices as you see fit. In low data/bandwitdh plans, data never rolls over from month to month though. At around the 100 unit mark you should also be able to negotiate a decent discount on the modems too (there was a time when they'd give them out to you for free, but that seems to happen much less often now).

While M2M-focused subcarriers can start offering you reasonable deals at higher quantities (high hundreds to low thousands) -- especially if you're paying for their industrial modems or other equipment -- generally they will be more expensive than going directly to the carrier if you don't need their equipment or specific expertise.