OpenAI Cuts Off Cursor Access to Its AI Models

OpenAI said on Friday that it plans to stop providing AI models to Cursor, the coding-tool company now owned by Elon Musk’s SpaceX. The company said in a blog post that it could not be confident that SpaceX would use its technology within its terms of service, citing experience with Musk’s companies violating contracts. OpenAI said the decision was tough, as it cares about broad availability of its models for developers. It proposed a shutoff date of November 12, 2026, noting that its contract with Cursor allowed a limited window to cancel following the change of control.

OpenAI pointed to past conduct by X, formerly Twitter, which it said had breached its contract after Musk acquired the platform. It also wrote that Musk had said under oath earlier this year that xAI had violated OpenAI’s terms by training Grok from OpenAI’s output. Musk had said at the time that it was “partly” true that xAI had distilled OpenAI’s models, as reported by The Verge in April.

Musk responded early on Saturday with an X post saying, “I couldn’t care less,” and accused Sam Altman, OpenAI CEO, and Greg Brockman, OpenAI President, of being “untrustworthy,” repeating his assertion that they “stole an open source nonprofit.”

Michael Truell, a co-founder of Cursor and now an executive at SpaceX, said on X that the company was speaking with the OpenAI team to resolve the issue.

The August Meeting: Musk’s Motivations

According to a report from The Information published Monday, based on five anonymous insiders, Musk spelled out his motives for SpaceX buying Cursor at a meeting on or around August 15, when SpaceX closed its $60 billion acquisition of Cursor. The report described Musk telling newly acquired Cursor staffers that they were his way of playing catch-up, with The Information summing up his description of his predicament as “he wasn’t used to losing.”

Musk said Tesla and SpaceX are “dominant” players in their respective markets, while xAI, his AI company, had “fallen behind,” per The Information. “Grok isn’t the leader in its market, and it desperately needs to catch up, he said,” the report wrote. Musk also said AI models would eventually become too advanced for humanity to control, making it necessary for SpaceX to “build the technology before other companies did,” according to The Information.

Since the acquisition, Cursor staff have moved over to SpaceX’s Slack workspace, starting last Monday, and were urged to visit SpaceX’s corporate HQ and to read the book “Liftoff: Elon Musk and the Desperate Early Days That Launched SpaceX,” per The Information’s report. The report also said 45 Cursor staffers have been hired since April, when SpaceX announced a partnership with Cursor.

In March, Musk had said that xAI was not built right first time around and was being rebuilt from the foundations up, as previously reported. According to Bloomberg, even xAI staffers who liked to vibe code frequently used Claude, Anthropic’s model.

The Broader Context: A Long-Running Rivalry

Musk and Altman have been at odds for years, a feud that culminated earlier this year in a trial over Musk’s $150 billion lawsuit against OpenAI. During the trial, Musk’s lawyer said that Musk and other witnesses had testified that Altman was a liar, while OpenAI argued that Musk had sought control of the company. A federal jury ruled against Musk earlier this year, finding that he had filed the case too late. Musk said he plans to appeal the decision.

In its blog post, OpenAI accused Musk of hypocrisy for criticizing the company while his own AI company, xAI, allegedly used OpenAI’s outputs to train its Grok model, and of using “strong-arm tactics” and“sabotage”to pursue his own commercial interests. OpenAI also noted that while it has historically been open-source, it has restricted some models for safety reasons.

Anthropic Steps In

Hours after OpenAI’s announcement, Anthropic, which rivals both OpenAI and SpaceX but has an ongoing partnership with SpaceX, said it planned to increase compute to support Claude models in Cursor, according to Tom Brown, one of the co-founders of the firm. Cursor, whose software offers models from several companies including OpenAI, Anthropic, Google, and SpaceXAI, will continue to offer alternatives to OpenAI’s models.