The No. 2 U.S. wireless service provider has set up a subsidiary to offer prepaid wireless services under the Aio Wireless brand. AT&T (T)said it expects the move to enable it to compete better with smaller rivals such as Sprint Nextel (S)and T-Mobile U.S. (TMUS), recently merged with MetroPCS Communications. AT&T shares fell 1.3% to 37.33. Sprint rose 0.4% to 7.35.