New Delhi, Jan. 26 -- India's top offshoring firms just reported a prolific quarter of billion-dollar contracts, but that also signalled a stark new reality for the $283-billion sector: an intensifying race among the country's largest software services providers to grab each other's share.

In October-December, Cognizant Technology Solutions Corp, Tata Consultancy Services Ltd and Infosys reported three mega deals combined, the most in nine quarters, according to their earnings filings. These involve deploying artificial intelligence (AI) tools to transform clients' legacy information technology (IT) infrastructure.

Yet, Fortune companies are reducing the number of IT vendors they work with to reduce their long-term software services cos...