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OpenAI has announced plans to terminate its agreement to provide artificial intelligence models to Cursor, the coding tool company recently acquired by Elon Musk’s SpaceX, escalating the long running rivalry between Musk and OpenAI CEO Sam Altman.
OpenAI in a statement released on Friday said it had notified SpaceX of its intention to wind down the contract, with a proposed shutoff date of November 12, 2026.
The company said it was giving Cursor the maximum notice allowed under its agreement to allow developers to retain access to OpenAI models through the platform for as long as possible.
What they are saying
OpenAI said the decision was driven by concerns over whether SpaceX would use its technology in compliance with its terms of service.
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- “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,” the company said.
OpenAI said its agreements with large partners typically include customised terms designed to ensure compliance with its policies and support the safe deployment of its technology at scale.
The company pointed to its experience with X, formerly Twitter, after Musk acquired the social media platform. OpenAI said X, which is now part of SpaceX, breached the terms of its contract with the company.
OpenAI also cited Musk’s admission under oath earlier this year that xAI, which has since become part of SpaceX, had violated OpenAI’s terms of service.
The company said its agreement with Cursor includes a limited window in which it can cancel the contract following a change in control.
- “Given all of this, we’ve decided to hold the contract cancellation to the latest date we can while not providing future models to Cursor,” OpenAI said.
Musk dismisses OpenAI decision
Musk responded to the announcement on X early Saturday, dismissing the move.
He also described OpenAI CEO, Sam Altman and President Greg Brockman as “untrustworthy” and repeated his accusation that the two executives had “stole an open source nonprofit.”
“I couldn’t care less. Scam Altman and Greg Stockman are utterly untrustworthy assholes who stole an open source nonprofit,” Musk wrote.
The dispute could affect developers who rely on OpenAI models through Cursor, although OpenAI said it intends to support users through the transition.
- “We know that the people most affected by this decision are the developers who rely on OpenAI models in Cursor. We care about their experience in this transition and we’re ready to go above and beyond to support them,” the company said.
OpenAI said it had worked with Cursor for nearly four years and expressed respect for the company’s team, product and contribution to the developer community.
The company said it had chosen the November 12 deadline to maximise the period during which developers can continue using its models on Cursor, while withholding access to future models including its upcoming Astra model.
Get up to speed
Musk and Altman have been engaged in a prolonged dispute over the direction and ownership structure of OpenAI.
- In 2024, Musk sued OpenAI and Altman, alleging that they had abandoned the company’s original nonprofit mission in pursuit of commercial interests.
- Musk, who co-founded and one of the early backers of OpenAI said the mission of the company was to be a non-profit that develops AI for the benefit of humanity.
- The Tesla CEO claims that Altman and Brockman convinced him to help found and bankroll the startup in 2015 with promises it would be a non-profit focused on countering the competitive threat from Google.
The case went to trial earlier this year, with Musk demanding between $79 billion and $134 billion in damages from OpenAI Inc. and Microsoft, claiming the artificial intelligence firm defrauded him by abandoning its nonprofit mission.
A federal jury ultimately ruled against Musk, finding that he had waited too long to bring the case.
What you should know
Musk left OpenAI’s board in 2018 and no longer holds a stake in the company. In December 2022 when ChatGPT just launched, Musk described ChatGPT as “scary good”, adding “We are not far from dangerously strong AI.”
In February last 2023, Open AI introduced a paid version of ChatGPT as it became a profit-oriented company. The subscription for ChatGPT Plus costs users $20 every month at the time.
The monetization of the service started just as a research report suggested that the AI tool reached an estimated 100 million monthly active users in January 2023, making it the fastest-growing consumer application in history.
