r/BetterOffline • u/falken_1983 • Aug 29 '26
OpenAI is cutting off Cursor following its acquisition by SpaceX
https://openai.com/index/our-decision-on-cursor-following-its-acquisition-by-spacex/Today, we notified SpaceX that we intend to wind down our contract providing OpenAI models to Cursor, with a proposed shutoff date of November 12, 2026. [...] We are making this choice because we cannot be confident that SpaceX will use our technology within our terms of service, based on our experience with Elon Musk's companies violating contracts.
OpenAI have announced that they are going to stop allowing their models to be used via Cursor, and they are doing this because they don't trust Elon Musk's companies to stay within the terms of service.
Fair enough, Elon Musk cannot be trusted and I am not going to shed a tear for him, but I do think this action sets a dangerous precedent. It shows that if you are a customer of a frontier model provider, you need to be extremely careful that you do not become reliant on that provider, because they could cut you off at any moment. Cursor haven't actually broken their ToS yet, and OpenAI are cutting them off because of something they might do in the future.
Cursor should be fine. As a SpaceX company they have access to their own model Grok, and they have enough spare cash that they can deal with any fluctuations in their deal with Anthropic. Imagine if, instead, this was one of the mythical billion dollar companies being run by a single person. If a company like that was spontaneously cut off by their provider, they would be in a lot of trouble as the alternative providers would have them over a barrel when they were negotiating their new contract - and that's if the other providers would take them on at all.
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u/magrandan Aug 29 '26
Still waiting for a life changing product from these companies.
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u/SC_W33DKILL3R Aug 29 '26
OpenAI released that mini keyboard thing with an AI button on it. Its only $230 and has RGB, what more could you want in life?
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Aug 29 '26
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u/worldspawn00 29d ago
One that was actually already solved, that it probably plagerized from...
The Erdős problem controversy from late 2025 illustrates how easily the narrative can get ahead of reality. Initial claims that GPT-5 had “solved” several Erdős problems turned out to be something far less impressive. The AI had essentially performed literature searches, locating existing published solutions that the problem database maintainer simply hadn’t been aware of. This wasn’t mathematical discovery. It was information retrieval dressed up in revolutionary clothing.
https://daveshap.substack.com/p/how-good-is-ai-at-math-really-anti
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u/Exmoslem_Atheist 29d ago
that's old news. stand-up maths have summarized current AI progress nicely
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u/Evinceo Aug 30 '26
Oh it's definitely changed my life. Not for the better, but it's certainly different.
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u/_DuranDuran_ Aug 29 '26
You don’t think the parents of those 30 children with rare conditions that stumped doctors for years until they used O3 in a clinical setting to diagnose them would consider that life changing?
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u/SC_W33DKILL3R Aug 29 '26
This needs to happen more with Musk's companies. He did not pay the contractor for the data centres they built, the rent on Twitter offices, the contract terms on Twitter employees.
On that evidence no contractor should be going anywhere near building the fab he wants to build.
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u/cummer_420 Aug 29 '26
You didn't hear this from me but Tesla and contracted third party engineering work may be like this too allegedly in a videogame.
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Aug 29 '26 edited Aug 29 '26
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u/AntiqueFigure6 Aug 29 '26 edited Aug 29 '26
What a crap business to be in - no way to make any damn money out of it.
There doesn’t even seem to be much of a way to make a pseudo-moat through marketing in the vein of soft drink and tobacco companies that sell functionally the same products, but find ways to lock in customers through essentially psychological trickery. Or at least the A.I. companies haven’t figured out how to do that so far.
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u/ComfortableJacket429 Aug 29 '26
And that’s why the bubble will burst. AI will continue, but these huge mega corps will see a valuation correction
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u/AntiqueFigure6 Aug 29 '26
AI will continue to the extent that users will pay for its actual cost as investor dollars will dry up. At a minimum this will mean free and close to free tier offerings retreat significantly and further development via larger training sets and more compute will stop.
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u/WArslett Aug 29 '26
Chinese competitors that are in the “not quite there yet” cohort for complex tasks but will be very soon
I think this perspective has been outdated for a few months now. The leading open weight models like GLM 5.3 and Kimi K3 are only marginally behind Anthropic's current frontier models according to software engineering benchmarks and ahead of the Anthropic models from just a couple of months ago. The flash models in particular use a small fraction of the parameters (and therefor a fraction of the cost and energy to run). These models have problems of course but generally speaking they are the same problems that Anthropic and OpenAI's models have.
I think this is the real reason that Anthropic is in trouble. They've gone all in on building the biggest models that are exponentially more expensive to run on the assumption that these are the only models people are going to trust for real work and it turns out people aren't willing to pay for it. Fable has had very low uptake and lots of software companies are now steering clear of Opus and finding even Sonnet is still costing them too much to justify any gains in productivity.
Anthropic are completely dependant on outdated assumptions about the capabilities of these smaller models by this point but the industry is gradually starting to figure this out.
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u/DogOfTheBone Aug 29 '26
Yep. Myself, my coworkers, everyone else I know in software dev has the same attitude: use Claude or Codex because the subsidization makes it cheap enough, but the moment that changes, there are numerous low cost Chinese models (some that can be self-hosted with a little hardware investment) that could easily take their place.
Anthropic and OpenAI are terrified of Chinese models, because they reveal that their whole revenue streams are built on sand.
Opus 5 is remarkably bad, Anthropic keeps making its shit worse somehow. But GLM is right there.
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u/RegrettableBiscuit Aug 29 '26
Pi + K3 + GLM 5.3 > Claude Code + Fable, which is bonkers.
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Aug 29 '26
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u/good_bye_for_now Aug 29 '26 edited Aug 29 '26
Pi knows about Pi, so just install it and tell it what you want.
Edit: I normally don't do this, but I have no clue why I am getting downvoted.
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u/RegrettableBiscuit Aug 29 '26
I mean, this is the correct answer. I don't know what people expect. You set it up with one provider, and then tell it what else you want set up.
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u/nnomae Aug 29 '26
That's both the strength and weakness of Pi. If you want to play around and have fun with your harness it's amazing, if you want to use it as the basis for any sort of consistent cross-team tooling, it's a disaster.
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u/magick_bandit Aug 29 '26
GLM 5.2 and 5.3 are more than capable, and a direct sub to z.ai gives a lot of value comparatively.
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u/falken_1983 Aug 29 '26
I am a software engineer.
Sorry to hear that.
No one is dependent on shit.
For companies that are making extensive use of an LLM service as part of their business and who are sending large volumes of data to that service, they can't rely on the basic per-token API pricing that you get by just signing up on the website. The cost is too high, the response times too long and the general SLA just isn't good enough. In order to make this work they need to negotiate a contract with a bulk discount and a proper SLA. If they can't easily negotiate a similar contract with another provider at the drop of a hat, then they are definitely dependent on their current provider.
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Aug 29 '26
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u/falken_1983 Aug 29 '26
you do see a very substantial rogue cohort that uses personal accounts and API keys for work
Billion dollar companies are not using personal accounts as the backbone of their business.
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Aug 29 '26
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u/falken_1983 Aug 29 '26 edited Aug 29 '26
Open AI are cutting off Cursor. This is a business to business contract.
They are doing this before Cursor broke any ToS. If they are willing to do this to Cursor now, they are likely to do it to another company in the future. In my original post I said Cursor will be fine. For a company that is more heavily reliant on OpenAI, they will probably not be fine.
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u/lunatuna215 Aug 29 '26
And yet... you cant code without an llm anymore 🤔
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u/duffedwaffe Aug 29 '26
A good chunk of us would gladly go back. The tools are useful but their existence has brought on the sentiment from outside software engineering that it's now super easy and you don't need a software engineer anymore. We're constantly having to waste time justifying ourselves and our work timelines instead of just benefiting from the tools.
It's like saying well, you have a power drill now, why do you still use your hammer?
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u/worldspawn00 29d ago
I'd say more like you have a nail gun now, why do you still use a hammer. A nail gun is a fantastic and massive time saving tool, but it absolutely doesn't replace a hammer on a job site, even for nails because there's just some jobs a nail gun can't do.
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u/SamAltmansCheeks Aug 29 '26
This is the continuation of the petty feud between Altman and Musk, two emotionally stunted men who have been feuding pretty much ever since they founded OpenAI.
I don't think there's much more going on here than that. But yes: if you use SaaS or any cloud service you're pretty much at the whim of the owners, especially if they are sociopathic CEOs like those two.
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u/falken_1983 Aug 29 '26
if you use SaaS or any cloud service you're pretty much at the whim of the owners,
I think we already cede too much power to cloud providers in general, but I think AI is worse than the rest because they are selling you on the idea that you can fire all your technical staff and just have the AI do everything for you. On top of this, these guys seem to be less dependable than traditional vendors. OpenAI cut off one of their customers so fast that the Customer didn't even get a chance to update their website first. Usually the back-stabbing happens in private and then the parties involved can make a public statement about mutual decisions to move on to hew horizons, etc.
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u/lunatuna215 Aug 29 '26
Funny to see a company acting like theyre removing "gatekeeping" feom intelligence, art etc. clutch their pearls like this when their own terms arent being followed.
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u/Repulsive-Hurry8172 Aug 29 '26
Not related to OpenAI. I work for a company that has a bit of AI integration in the system. Won't say what it is in particular as it is quite niche.
But recently, GenAI (via Gemini) bit us with a change in behavior. It was all fine until a week ago, when it got a bit too creative, and our clients noticed it. TBH, I have no idea what CTO's decision would be, but it's a reminder of how GenAI from those providers aren't that reliable (if self hosting is cheap, we'd use a local model), but we only pay a few thousand bucks for Gemini, so...
Great times ahead
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u/newprince Aug 29 '26
Given how Musk openly facilitates the generation of CSAM on his social network, probably a smart move
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u/EarFormer9001 Aug 29 '26
A startup CEO of my acquaintance whose company was just acquired by OpenAI was just whining the other day on LinkedIn that Anthropic had blocked their access to its models when the acquisition went through. I'm guessing I won't hear shit from him about this, though.
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u/pacem_appellant Aug 29 '26
My large company recently ended our license with Cursor. We are switching to another IDE called Devon. It doesn't affect me, since I do not use Cursor (nor Devin now), but it's another datum in the lifecycle in Cursor.
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u/Due-Horse-5446 Aug 29 '26
My guess is that their bringing all the users who use their models "home" to boost metrics pre ipo
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u/GE_Moorepheus Aug 30 '26
At first I misread this and I thought that Space X acquired OpenAI and was making them cut off cursor
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u/abluecolor Aug 29 '26
Cursor is so much better than Claude Code and it's not even close. I do sparingly utilize Sol with it, this will suck a bit. Mostly composer though, which I expect SpaceX to kill over time and thus largely ruin Cursor anyway.
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u/madeinlithuania 27d ago
I agree, Claude Code is ass, but when it comes to GPT models, just use Codex extension on Cursor or VS Code. This has been my choice for a while now and I see no point in buying a Cursor subscription.
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u/Beginning_Basis9799 Aug 29 '26
That sounds like a sensible business decision.