Apart from the multinationals like HP and IBM, even companies like the domestic outsourcing specialists, Tech Mahindra and Wipro are eying the $1 billion deal from the New Zealand based biggest phone firm - Telecom Corporation.

In fact, it has been learned that the New Zealand based giant is aiming to cut costs by outsourcing non-core IT work that is attracting many IT companies across the globe.

It may be noted here that as the company had signed a $1.5-billion IT infrastructure management contract in 1999 with EDS, which is now owned by HP is set to expire this year.

Moreover, the person familiar with the matter said that this deal will see almost everyone running in the hunt and the new entrants will cause problems for the old players as they will be ready to do more for less.

The New Zealand based company has confirmed the developments of early discussion but has declined to divulge any further details about the same.

However, the company has not issued any formal tender so far but still companies like IBM, HP and Tech Mahindra are already in talks with the New Zealand based giant.