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UPDATE 1-AT&T CEO sees iPad mostly used on Wi-Fi

* sees iPad buyers using Wi-Fi, prepaid

* Does not see a lot of subscriptions for iPad

* AT&T shares close down 0.5 pct

NEW YORK, March 2 (Reuters) - AT&T Inc T.N expects users of Apple Inc's AAPL.O iPad to connect to the Internet mostly using short-range Wi-Fi networks rather than AT&T's cellular network, the chief executive of AT&T said on Tuesday.

While AT&T has agreed to provide wireless connections to the iPad tablet computer, Randall Stephenson said he does not expect the device to result in many new service subscriptions for AT&T as consumers will instead use Wi-Fi or prepaid services, where they do not subscribe to a service contract.

“My expectation is that there’s not going to be a lot of people out there looking for another subscription,” he said during a webcast of an investor conference, adding that the device would be a mainly “Wi-Fi driven product.”

Many consumers have their own Wi-Fi networks at home or go to coffee shops where they can avail of free Wi-Fi.

AT&T shares closed down 0.5 percent at $24.88 on the New York Stock Exchange on Tuesday. (Reporting by Sinead Carew)

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