OpenAI Cuts Off Cursor AI Amidst Musk-Altman Feud

OpenAI has decided to cease providing its AI models to Cursor, a coding-tool company recently acquired by Elon Musk’s SpaceX, marking a significant escalation in the ongoing rivalry between Musk and OpenAI CEO Sam Altman. This move comes after SpaceX completed a substantial $60 billion all-stock acquisition of Anysphere, Cursor’s parent startup.

The decision stems from OpenAI’s stated lack of confidence in SpaceX’s adherence to its terms of service. OpenAI specifically referenced a history of past contract violations by other companies under Musk’s control, indicating a pattern of non-compliance.

Terms of Disengagement

• OpenAI cited that X (formerly Twitter), also under SpaceX ownership, had previously breached its contract terms.
• The proposed date for the AI model shutoff to Cursor has been set for November 12, 2026.
• This action leverages a specific contract clause that permits cancellation following a ‘change of control’ in the acquired entity.

The long-standing feud between Musk and Altman has seen previous legal battles. Musk had notably filed a substantial $150 billion lawsuit against OpenAI.

Historical Tensions

• Musk’s lawsuit against OpenAI was ultimately dismissed by a federal jury.
• The dismissal was attributed to the lawsuit being filed late.

Currently, Cursor’s platform provides a diverse range of AI models to its users. These include Grok models from SpaceXAI, alongside offerings from other major players like OpenAI, Anthropic, and Google.

Michael Truell, a co-founder of Cursor who is now a SpaceX executive, is actively engaging with OpenAI to seek a resolution to the ongoing dispute. The outcome of these discussions remains critical for Cursor’s future model access.