OpenAI cuts off Cursor after SpaceX acquisition, citing Musk's history of breaking contracts
OpenAI is cutting off the AI coding tool Cursor after SpaceX acquired the company, citing Elon Musk's track record of breaking contracts. Cursor co-founder Michael Truell downplays the move, saying OpenAI models account for just five percent of the tool's AI traffic.
OpenAI cuts off Cursor after SpaceX acquisition, citing Musk's history of breaking contracts Matthias Bastian View the LinkedIn Profile of Matthias Bastian Aug 29, 2026 Nano Banana Pro prompted by THE DECODER Update – Aug 29, 2026 Anthropic is using OpenAI's decision to position itself as the more reliable partner. Tom Brown, Anthropic's co-founder and Chief Compute Officer, writes on X that Cursor has been a trusted partner since Sonnet 3.5 and that Anthropic will continue to expand compute capacity for Claude models in Cursor. There's some irony in Anthropic playing the loyal partner card here. The company has pulled API access from partners on multiple occasions, including blocking Windsurf after its planned sale to OpenAI and revoking OpenAI's own access over unauthorized use of Claude for benchmarks (see below). OpenAI is ending its contract with the AI coding tool Cursor after SpaceX acquired the company, saying that Elon Musk's companies have repeatedly broken contracts. OpenAI announced that it will terminate its contract with Cursor effective November 12, 2026. According to the company, this is the maximum notice period allowed under the contract, which includes a clause giving OpenAI a limited window to end the agreement after a change in ownership. SpaceX's acquisition of Cursor triggered the move. OpenAI now says it can't be confident that SpaceX will follow the terms of service. "It boils down to trust," OpenAI's Thibault Sottiaux says. Users who access GPT models through Cursor will still be able to use their own OpenAI API keys, and OpenAI will continue to provide access through its IDE extensions for Cursor. Sottiaux goes out of his way to signal that this is a specific move against Musk, not against the broader AI coding tool landscape and its developer community.Ad Musk's companies have a track record of breaking contracts, OpenAI says The suspension is the latest chapter in a years-long feud between Musk and OpenAI that has also played out in court. OpenAI specifically accuses Musk of breaching contracts after his acquisition of Twitter and of trying to extract data. The AI lab had a licensing deal with Twitter that gave the company access to the full tweet data feed for about $2 million a year to train ChatGPT. When Musk found out about the agreement in December 2022, he thought the price was too low and cut off OpenAI's access.Ad Musk also admitted during the legal battle that he used data from other labs' AI models to train his own Grok models, a practice known as "distillation." That, too, violates OpenAI's terms of service. OpenAI is also framing this as a safety issue. With the upcoming Astra model, which reportedly has advanced cyber capabilities, there's "a new level of accountability" to make sure partners comply with the terms of service. For a company that has spent years warning about the risks of AI, the implication that previous accountability standards were somehow sufficient is a curious one.Ad Cursor says OpenAI accounts for just five percent of its AI traffic Cursor co-founder Michael Truell responded quickly, saying OpenAI models made up only about five percent of Cursor's AI traffic. The company is in talks with OpenAI's team to find a solution. "Cursor was one of the very first users of OpenAI, we've worked closely with their team for years, and we've trusted their platform to be neutral infrastructure for our business," Truell writes. OpenAI knows how being cut off feels. In June 2025, Anthropic blocked the coding tool Windsurf from accessing its Claude models after reports surfaced that OpenAI wanted to acquire Windsurf. In August 2025, the tables turned on OpenAI when Anthropic revoked the company's API access because OpenAI teams had apparently used Claude for internal benchmarks ahead of the GPT-5 launch.Ad Ad AI News Without the Hype – Curated by Humans Subscribe to THE DECODER for ad-free reading, a weekly AI newsletter, our exclusive "AI Radar" frontier report six times a year, full archive access, and access to our comment section. Subscribe now Source: OpenAI | Brown via X