So this is OpenAI following suit after Musk admitted to distilling their models.
This was bound to happen once Cursor decided to sell itself to a competing model provider.
It'll be interesting to see if Anthropic applies their ban to Cursor, or if that datacenter deal they signed with Musk changes anything.
If you can take any book and turn it into a model, because it's "transformative enough", and "AI learns just like a person does", then surely a model distilling another model is transformative and fair use.
They tied themselves into knots fighting the letter of the law, and now, when they need the spirit of the law - that each creator deserves protection for their work - now we devolve to the law of the jungle. Maybe we'll even see LLM book curses, the way medieval scribes damned book thieves to blindness and worms.
Just look at the pattern... they collude, they provide to them whatever is needed, and at some point, if this is not true yet, they will be the ones who will tell them what to do or not, bc you know how humans are, right... blackmailing, mess up the business or shames of people, etc.
It is just a matter of time. The state, as we know it, will collapse or will be greatly reduced, which, from a point of view, is positive, from another, Idk, bc if someone replaces that, we will be in the hands of someone, as usual...
Imagine the United States DoD, CIA, NSA training an LLM on all its top secret intel.
Guy this was openly stated more than a decade and half ago by all the current oligarchs
Also, copyright has always been privately enforced anyway?
Enforcement ultimately happens through law and the legal system.
I mean it quite likely is sort of in the same legal bucket. It won’t stop them suing but it is going to be the legal equivalent of two biologically-related warlords making their champions fight with their hands tied for sport.
That thread you linked suggested they were using it with cursor as part of their development process, not for distilling.
>"Hi team, I believe many of you have already discovered that anthropic models are not responding on cursor. According to cursor this is a new policy anthropic is enforcing for all its major competitors."
And a month before the OpenAI block, they blocked Windsurf for the same reason: https://www.forbes.com/sites/johanmoreno/2025/06/05/anthropi...
So its pretty clear the TOS had this clause prior to Jan 2026.
This is a battle for power, let us not be naive...
Just go ahead and do set it up. You’ll be my hero (I don’t have mental capacity to research which jurisdiction works for this right now, but obviously not in US or EU.)
It's hard to imagine a 1B / month deal wouldn't.
what's the moat for AI labs like OpenAI and Antrhopic as they seek trillion IPOs. a lot of people said Chinese models also distill US LLM models. if it is this easy to do. how do US AI labs justify asking for trillion?
Otherwise, it will be competitors distilling, and the government getting upset.
It's hard for me to see a different future.
And, this really sucks.
If this thesis is true, I wonder what the final YC batch number might be.
Even if they have Astra or whatever completely to themselves, how do they deal with the -product- side? Or sales, or account management?
They've been focused on juicing model's coding capabilities, but it's absolutely -not- "gen ai" enough to be doing the whole thing in agents, even 3 or 5 years from now, if only because there's so much context we _can't_ give to these models, without reverse centauring ourselves with cameras and mics and oodles of compute everywhere, and so far that hasn't exactly been playing out the way the frontier labs and the singularity folk hoped it would (meta glasses? humane? really?)
Some of you guys hate Musk so much that you say blatantly nonsensical stuff. Like, how can you be on HN and authoritatively mouthing off and not have some idea about the xAI-Anthropic compute contract, or the fact that xAI took down its own Grok compute capability so it could sell that compute to Anthropic? And if Anthropic hated Musk/xAI as much as you are saying they do, why would they be paying xAI billions for compute? Think/research before typing.
Some of us are still employed mate
- fast because the code is already indexed no need to start every prompt rediscovering the world with rg
- in editor/vscode review much better than relying on git diff at the very end. You can click on next button to jump there. Quick edit in place. Or a quick prompt (seconds) to fix something small
- in editor completion / quick edits, when you do things by hand.
It seems that everyone loves agentic Claude code things these days but I don’t understand how you can review what it did and remain as much in the flow as you do with cursor.
Also I find that incredibly slow. By the time Claude finished a prompt I could have done a few in cursor.
And mind you, I’ve been wanting to use zed instead but the clunky vscode fork called cursor. But cursor has just a better UX for AI integration even though it’s slow and guzzle up RAM.
but the the review what the AI did by jumping directly into the file with accept/reject/go next/next file with the ability to edit in place was nowhere near as good in zed vs cursor last I checked.
The features you mention are in Antigravity IDE v1, which I am trying as I still have a Gemini subscription.
No idea how long it will be around for, as Google Antigravity2 (more like Claude Code) is clearly the favoured way forward, plus the new Antigravity for VSCode Extension*, which I didn’t like as much when I tried it. It offers the same accept/reject hunk workflow, but I don’t know about editing in place. It doesn’t feel as if it has the tight integration of Antigravity IDE v1, which feels as if it was designed to challenge Cursor.
Having said that, much of the time I use Google Antigravity2 alongside a Jetbrains IDE. You can still review all diffs within Google Antigravity2 and attach comments to any line on order for a followup prompt to make amendments. But I still prefer the review and accept/reject hunk workflow.
* https://marketplace.visualstudio.com/items?itemName=Google.g...
There are things I will probably miss from Cursor, as they used to iterate on DX goodies quite quickly. For frontend tasks, I liked the idea of Cursor Browser being able to do a devtools-like selection of an element tree to be included in the chat context. I’ve been told there are similar extensions available for vanilla VSCode, so will have to see how good they are.
I don’t like relying on GIT for that and making things as good/done as I go. But with these agentic tools that’s what I have to do. Stage everything I like, manually edits a few bits.
But what do you when you find something where you want to say the agent: I don’t like this for reasons x and y redo as z. I’m like one shortcut away in context inside cursor to say that to my agent? You have to change tab in herdr and then what? Type the file name and line numbers? Is there a way to do this that does not seem very frustrating?
Also open code, codex, etc. super slow. They grep the code. Every. Single. Time. Cursor has a semantic index
I know this is change of context, but I have full screen terminal toggled with keyboard shortcut and with middle mouse paste (Linux) I do not have to move cursor anywhere
The in-editor context review is something that does not seem long for first world. Sadly. Maybe I’ll be forced to make a zed extension or something, maybe on top of jujustu…
The GUI slightly better than Claude. And it’s a million times cheaper than Claude.
Cursor is already kind of useless for third party models unless you're willing to spend thousands of dollars. It's only worth it if you're going to use mostly grok/composer.
I think it's possible to have a better TUI, with something that isn't modeled after a shell prompt. Apparently, recent updates move in that direction. The GUI version of Claude Code seems to be coming to Linux, too.
Additionally helpful where 2 apps/repos might require running at the same time, e.g. headless web apps, or, for plugin development where the plugin might be a dedicated repo but needs to run in another app to observe changes and make it re-test itself.
I also switched from terminal to the app not that long ago, I don't find it buggy, it has access to a browser which is really helpful.
However, what I see cooking at Cursor is way more promising than the others. Things like full system understanding, their own forge, multi-repo support. I'd put them as way more visionary in the Gartner magic Quadrant ;)
In particular Haiku 4.5 is rubbish, Anthropic don’t have anything in the cheap/fast part of the market.
For people fortunate enough to still be on a subscription instead of per-token billing this is less relevant, but their time will come.
The cursor model is quite nice because it allows you to switch between cheap and expensive models for different tasks
Now, I’m no expert, because I was late to the game and have only ever used Pi. But I guess Cursor is some product that’s tied to your IDE? If so, then yeah. That’s just too restrictive. I still love my IDE, but I don’t want it to be my harness too.
Claude Code works with models from other providers too. Anthropic supports this. You can configure some Claude Code environment variables to switch: eg changing ANTHROPIC_DEFAULT_HAIKU_MODEL to point to GLM Flash or Luna, setting ANTHROPIC_BASE_URL to point to api.z.ai, and making ANTHROPIC_AUTH_TOKEN the API key for your alternative provider instead.
Some instructions here:
https://docs.z.ai/scenario-example/develop-tools/claude
That said, I've not actually tried this myself, opting to build my own harness instead. And you don't know what information Claude Code might be sending back to Anthropic about how you use competing models and which models you use. I don't know for sure that they do this, but after hearing about how they used steganography in the date of harness system prompts to identify the user's location, I don't entirely trust Claude Code anymore.
Why do you say that? I've used Claude Code with DeepSeek via OpenRouter just fine.
I basically never use the editor but the fact that there's a review UI for all the agent work is incredibly helpful.
For me, that makes the models much more usable. I've also been using GPT models a lot, as they're cheaper and less vomit inducing than Claudes text, so this is definitely bad news for me.
Inference is cheap; Dax once said on a podcast that Opencode has a close to 90% profit margin on the openweight models it provides inference for (at 10x cheaper pricing). Those models are close in size and spec to models from large labs.
If either one of them stops doing that, customers will stop using them, because other models will become better.
In other words, there is no point in talking about inference cost in isolation.
Honestly, _this_ was their moat more than Composer to me.
Why? Written by does not mean designed by etc. There's a lot more to it.
I dont know how cursor works. Everytime ive tried to use, its super buggy and has memory leaks that make my very quite PC sound like a jet engine.
It is for 3rd party models (which you get double the amount of your sub price as usage).
Of course they wont charge you extra for BYOK. how would they???
Shit, for most things, ive got a dev agent that reads change requests from a GDoc and communicates through email with me. I can develop in my mobile
Big reason we built https://boxes.dev around the model harnesses (Codex + Claude Code), so you can bring your own subscriptions.
On the other hand, subscriptions create lock-in in a way that API pricing doesn't.
I think a more likely end is that subscription value decreases over time because API pricing gets more reasonable, but subscriptions stay because they are a good way of getting money out of people consistently.
This is why "subsidized tokens" is possibly a misnomer. Money at lower variance is worth more than the same money at higher variance. Not "subsidy" so much as reducing risk and passing some of that to a consumer.
How long have you been in tech, outta curiosity?
Edit: great answer.
What do you mean by that? If you're being sassy about a downvote then I'll remind you that when you reply to a comment, that person can't downvote your reply. Also this is an account with barely any comments or points, I'm pretty sure they can't downvote at all.
Using both OpenAI and Anthropic models, Cursor is cheaper than having two separate subscriptions, and their free tier of Composer is good enough. I will now have to reconsider my options.
Then you can let it run, and when it stops, point a fresh session to the ledger to pick up the work from where the previous one left off.
You can get more fancy by using something like GitHub issues for coordination too and have multiple sessions create issues and epics and others to work on that in isolated worktrees, but the spec-plan-ledger approach usually works great for small to medium large projects.
I took the 50% discount instead of cancelling - but with this I'll likely not renew.
So sad to watch them go from great to mediocre in such a short time.
Ironically, as a Cursor and Claude subscriber, but not an OpenAI subscriber, this will push me back to Anthropic. I don't feel good about giving OpenAI money directly, but I've found switching to GPT 5.6 Sol now and again in Cursor to be useful. Now I'll probably just forget about OpenAI models.
They're commodity fetishism maxxing.
> as a Cursor and Claude subscriber, but not an OpenAI subscriber, this will push me back to Anthropic
Instead of deciding based on the merits of the model, they are being pushed by the actions of the companies. You should be able to use the best model, or whatever model you like, independently of what any company thinks or does.
This provides a method, but the data looks stale and perhaps a bit thin compared to say, Cursor, or even AntiGravity data.
It has been more of an OpenClaw or Hermes alternative than a coding agent like OpenCode or Pi, so it’s likely to do well given less context bloat.
Cursor will be fine after this, as they have their own first party models and can potentially use open weight models via API or their own hardware, which have gotten good enough to Opus and Fable quality now for many use cases.
Burn.
Anyone else surprised that the maximum notice period allowed is about 3 months?
I would have thought 3 months is minimum notice period, with provisions to stop faster if any provable violation occurs.
This clause probably has a expiry date and they are saying “we are trying not to be jerks here by waiting until the last second to trigger it”.
But this is kind of like banning GPU exports to China. It will encourage them to develop their own technology. Yes, it will take them longer, but in the long-run China will be more successful with their own GPU tech.
The same could be true of SpaceX/xAI
You had me until:
>The same could be true of a company run by a drug addict.
Elon Musk is nowhere near as capable as millions of intelligent developers in China.
I think Sam Altman has played a clever business move here, they can use this excuse immediately after the Hugging Face leaks and it's not going to be dismissed willy-nilly. Whereas long term they probably wanted to end their partnership with Cursor anyway. I bet Dario will be happy about this too, but maybe the compute deal prevents him from doing similar anytime soon.
Very interesting times we live in...
This move seems to protect Astra against distillation. I wonder whether Astra will be released before or after 11/12.
codex growth at 20mill now, prob more cost effective to allocate that compute to people directly paying now
If your coding tool depends on other companies’ AI models, one business decision can suddenly change the whole product
The quality/price ratio is clearly superior when running Qwen, GLM, or Deepseek.
To make a product more exclusive won't hide the fact that product is becoming more and more irrelevant.
Do I smell a cursor-analogue from openAI?
I wonder if Anthropic will follow suit given their campaign against distillation or if they'll stay quiet given their reliance on SpaceX (among others) for hardware.
The products are basically equivalent but JetBrains is a profitable bootstrapped company that has been building IDEs for 20 years and Cursor is a flash in the pan startup with a squillion dollar valuation to support. Sooner or later they’re going to do something that will fuck their users over.
And selling to SpaceX was it!
Maybe if Claude joined along it would be more impactful. For better or worse though, Xai seems like its lining themselves up to handle being on their own for cursor.
Is there a way to work around this (like using your OpenAI limits directly?)
The first party cursor models (initially composer and now grok-cursor) and price very competitively for their quality and have very generous usage limits included in the base plans, and then per token pricing afterwards.
Occasionally I’ve used some of the Anthropic models in it but found their cost massively outweighed the benefits for the type of usage we do.
I was using Sonnet 4.5 and 4.6 for a while but the newer models are a lot more expensive at the per-token pricing.
The movie Goya’s Ghost explains this in great detail.
It's gunna to happen anyway.
We are sailing into the age of vertically integrated intelligence.
There are also a bunch of newer startups in this space. I'm building one myself, https://boxes.dev -- we're very early but building for this exact use case. Some other ones worth a look are Factory Droid and Amp Orbs. Those two build their own agent harness (like Cursor), whereas with boxes.dev we run the native codex and claude code harnesses directly.
Last year, Anthropic cut off Windsurf the same way [2]. Fortunately, unlike Anthropic, OpenAI allows you to use your subscription with other harnesses, including Cursor.
Of course today, Anthropic is taking the "high road" and is OK with with SpaceX [3] including their models in Cursor, because they need SpaceX's compute.
[1] https://www.forbes.com/sites/antoniopequenoiv/2026/04/30/elo...
[2] https://techcrunch.com/2025/06/03/windsurf-says-anthropic-is...
Not doing business with them is a completely normal and unremarkable decision.
> After Musk acquired Twitter, now part of SpaceX, the company broke (opens in a new window) the terms of our contract (alongside many others).
I have never seen one large company throw another large company under the bus without any legalese filters like this before. Wondering if OpenAI site got pwned. Or maybe we in some strange, alternative reality. I doubt even their LLMs would be this frank.
https://www.theverge.com/ai-artificial-intelligence/921546/e...
[1] https://www.forbes.com/sites/antoniopequenoiv/2026/04/30/elo...
i loved switching between sol / fable / grok 4.5.
... and something tells me fable might not be available on cursor for much longer :/
> we’ve decided to hold the contract cancellation to the latest date we can while not providing future models to Cursor.
https://news.ycombinator.com/item?id=49428835
If Claude pulls away from Cursor as well then Cursor is basically done.
I'm not a fan of Elon, nor do I use Cursor, but OpenAI and Anthropic aren't the only models.
Also, it's a signal more than anything. OpenAI pulls out of Cursor. Then Anthropic and Google does as well. Then you no longer have "Cursor" you have Grok.
Grok doesn't have the best reputation in general, regardless if you're tech savvy or not.
Seriously though, when the api providers start blacklisting cursor and they’re forced to swap to open weight models…
If that happens, what even is the difference between openrouter and cursor?
Strategically, OpenAI long-term will want to own the direct relationship with all their customers. As will most major AI labs.
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.
For a company named "Open" AI, they've been hardly open at all and the slew of resignations of top tier execs in the company is really the proof.
Make no mistake, this isn't a moral decision. This is just killing the competition using morality as an excuse.
i only tell VC type people or others from whom i want something "oh yeah grok is cool" if they mention it, because they're always sucking off Elon
i work in qa so i'm naturally wary of adding another critical dependency to a development workflow, if the model you actually want can just disappear because two vendor change ownership or start argueing then the wrapper has to be really good on its own.
cursors harness and its own models may be good enough that users stay, and if they do cursor has a moat at least. if everyone follows the openai models out the door, it will just become a polished ui.
Our decision on Cursor following its acquisition by SpaceX
https://openai.com/index/our-decision-on-cursor-following-its-acquisition-by-spacex/