Does M2M hold lessons on how to charge for mobile data?

(This story is part of Connected Planet’s Mobile Data Paradox microsite –  an ongoing collection of features, blogs and opinions on the key question facing mobile operators today: how do you make a business of 4G and mobile data?

It all leads up to the 4G Salon event at our upcoming Connected Planet Virtual Industry Forum. Register now to join us at this exciting, interactive event.)

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Mobile operators are wrestling with the problem of how to charge for mobile data. On one hand, they want to offer cheap, simple data plans to consumers to encourage the adoption of mobile broadband services. On the other, the increasing sophistication of mobile applications and the growing hunger of consumers for more content and bandwidth has led to skyrocketing traffic levels and network consumption. A batch of recent studies have shown that data traffic on the mobile network is not only increasing exponentially, but also that revenues operators are collecting aren’t keeping pace.

Most operators have already imposed data caps on the laptop mobile broadband plans, and some such as AT&T and O2 in the U.K. have started imposing tiered pricing models on their smartphone plans. But at the same time, operators and Internet services companies have begun offering more bandwidth-intensive applications, ranging from two-way video chat to full-length film streams. Just as operators are trying to rein in escalating data consumption, they’re also introducing services that will encourage that escalation even more.

So how do operators solve this quandary? How do they shape viable pricing models for mobile data without placing onerous restrictions on their customers, avoiding overtaxing their networks and all the while encouraging the rapid adoption of mobile broadband and data services?

That’s a question we’ll return to many times as part of the Mobile Data Paradox interactive feature, but in this installment, we’ll look at whether one emerging segment in the wireless industry, machine-to-machine (M2M) communications, can offer operators any clues on how to craft their pricing models of the future.

Next: Inside M2M