OpenAI plans to stop providing its artificial intelligence models to Cursor, a coding-tool platform recently acquired by Elon Musk’s SpaceX, according to a Reuters report published on August 28. The decision marks a sharp escalation in the ongoing rivalry between OpenAI Chief Executive Officer Sam Altman and Musk, who have spent years locked in legal and public disputes.
OpenAI Cites Terms of Service Concerns Over SpaceX Deal
In an official blog post, OpenAI stated that it cannot be confident SpaceX will use its technology within the bounds of its terms of service. The company attributed this caution to its prior experience with other enterprises owned by Musk. According to OpenAI, social media platform X, which Musk acquired and subsequently integrated into SpaceX operations, previously breached its contract terms.
“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 said in the blog post.
To manage large enterprise arrangements, OpenAI typically relies on custom agreements to enforce safety standards at scale. However, the company noted that its existing contract with Cursor contained a specific clause allowing a limited cancellation window following a “change of control.” SpaceX announced a $60 billion all-stock agreement in June to acquire Anysphere, the startup behind Cursor, and finalized the purchase earlier in August. OpenAI has proposed a shutoff date of November 12, 2026.
Did you know? SpaceX completed its acquisition of Anysphere, the creator of Cursor, for $60 billion in an all-stock transaction earlier in August, bringing the AI coding assistant under SpaceX’s operational umbrella.
Elon Musk Dismisses OpenAI Cutoff as Feud Continues
Musk responded to the announcement early on Saturday through a post on X, writing simply that he “couldn’t care less.” He launched further criticisms at Altman and OpenAI President Greg Brockman, labeling them untrustworthy and repeating past allegations that they improperly converted an open-source nonprofit into a commercial enterprise.
The latest clash builds upon a turbulent legal history between the parties. Earlier this year, a federal jury ruled against Musk in a $150 billion lawsuit targeting OpenAI and Altman. The court found that Musk had filed the action too late, though during the trial, legal counsel for Musk presented testimony accusing Altman of dishonesty while OpenAI countered that Musk had attempted to seize control of the organization.
Anthropic Steps Up Compute Support for Cursor
Just hours after OpenAI’s announcement, rival AI firm Anthropic stated its intention to increase computing support for its Claude models within Cursor, according to Anthropic co-founder Tom Brown. Despite Anthropic’s ongoing partnership with SpaceX, the firm is positioning its models as a viable alternative for developers utilizing the coding assistant.
Michael Truell, a co-founder of Cursor and a current executive at SpaceX, stated on X that the company remains in discussions with OpenAI to resolve the compliance dispute.
Frequently Asked Questions
Why is OpenAI cutting off Cursor?
OpenAI stated it lacks confidence that SpaceX will operate its technology within the platform’s terms of service, pointing to past contract breaches by other companies owned by Elon Musk.
When will OpenAI stop supporting Cursor?
OpenAI has proposed a contract termination and shutoff date of November 12, 2026, utilizing a change-of-control clause triggered by SpaceX’s acquisition.
Who owns Cursor now?
Cursor is owned by SpaceX, which completed a $60 billion all-stock acquisition of Anysphere, the startup that developed the coding tool.
How is Anthropic responding to the dispute?
Anthropic plans to increase computing capacity to support its Claude models on the Cursor platform, according to Anthropic co-founder Tom Brown.
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