Every time a device updates a sensor variable, then one data-point or "dot" is created. For example, if you have a weather station with 4 sensor variables being updated every 10 minutes (i.e. temperature, humidity, pressure and rain), then your device will generate: 4 dots x 6 times/hour x 24 hours x 30 days = 17,280 dots per month , which fits perfectly into your monthly quota.
A Sensor variable is a series of data-points that change over time.
In most cases, it will represent a physical sensor that measures something from the real world, such as Temperature, Humidity, Pressure, Water Level, Disk Usage... or any time-stamped data!