OpenAI Ends Model Supply to Cursor
OpenAI has announced that it will discontinue providing its artificial intelligence models to Cursor, the AI coding startup. This decision follows the recent acquisition of Cursor by Elon Musk’s SpaceX earlier this month. OpenAI has set a proposed deadline for the cessation of model access for November 12, 2026.
Michael Truell, the CEO of Cursor, stated on the social media platform X that OpenAI models currently account for approximately 5% of Cursor’s user traffic. Truell noted that the companies are actively discussing the matter, recalling that Cursor was one of the initial users of OpenAI and that they had maintained a long-standing, trusting partnership with the platform for business needs.
In its official statement, OpenAI explained that the decision was made because the company could not guarantee that SpaceX would adhere to OpenAI’s service terms and conditions, citing past instances where Elon Musk’s companies had violated contractual agreements.
Background of the Acquisition and Industry Tensions
Financial records indicate that SpaceX finalized its purchase of Cursor for $60 billion on August 14. Prior to going public in June, SpaceX had already absorbed Musk’s X platform and xAI in February.
This withdrawal of service by OpenAI is viewed as part of a protracted and contentious rivalry between OpenAI CEO Sam Altman and SpaceX/Musk. On Saturday, Musk posted on X, stating, “I couldn’t care less. Scam Altman and Greg Stockman are utterly untrustworthy,” and further accusing them of having “stole an open source nonprofit.”
Musk had previously initiated a lawsuit against OpenAI, Altman, and Greg Brockman in 2024. The legal action stemmed from the fact that Musk was a co-founder and contributor to the AI company when it operated as a non-profit research facility in 2015. Musk had departed the OpenAI board in 2018 following disagreements regarding the company’s direction, after withdrawing promised donations, and after hiring talent away from the organization. He has since become a highly visible critic.
Since Musk’s exit, OpenAI launched major successful AI products, including ChatGPT. The company also secured significant partnerships with technology giants like Microsoft and transitioned its business structure to a for-profit model while maintaining a non-profit parent entity, raising substantial capital in the process. OpenAI disputes the claims made by Musk, who continues to argue in court that the company’s restructuring violated its founding commitments. Although Musk lost a lawsuit earlier this year, he plans to appeal the ruling.
Broader Industry Implications
As the market for AI-assisted coding tools, or “vibe coding,” grows, OpenAI is reportedly preparing for an initial public offering (IPO) next year. Meanwhile, its competitor, Anthropic, has been holding preliminary meetings with financial institutions regarding a potential IPO this year, with an estimated valuation as high as $2 trillion, according to previous reporting.
The action taken by OpenAI is not unprecedented in the tech sector. Earlier this year, Anthropic—which is now partnered with SpaceX and utilizing compute capacity from Musk’s company—had restricted Windsurf’s access to its Claude AI models.
In response to the industry development, Anthropic co-founder Tom Brown posted on X that, Cursor has been a trusted partner of Anthropic since Sonnet 3.5. We’ll continue to increase compute to support Claude models in Cursor and are excited for what comes next with them at SpaceX.
This statement prompted commentary from other technology leaders on X, including criticism regarding Anthropic’s prior relationship with Windsurf.
