ChatGPT is a great breakthrough but it’s wasted if everyone has to worry about a noncompete with it. Seriously, how is it not insane to think we should outsource our thoughts and agree never to use the thoughts to compete with the thinker? Who wants to live in a world where nobody thinks and nobody can make anything competitive with their “Saviour Machine?”
Anybody who would join an org like that for a few billion dollars is a sell out. It’s an AI safety nightmare, too. I’m just flabbergasted millions of noobs accept not to compete with intelligence, wtf is this world, if you can’t use your thoughts to compete with your thinker, what is left for you? lol this is worse than black mirror
So what was it exactly that was worth the 3B that they couldn't replicate themselves? Their prompts? Their training sets? Their users or user data?
I've found Windsurf more reliable/efficient than any other editors by leagues. How ever they have named the tools, crafted their prompts and generally how their internals reason is just on the money. I don't think that is easy to replicate, iterating on prompts over product releases whilst not pissing off your user base constantly is a feat in of itself.
When I went to download Cursor the other day I noticed that they do not offer any .deb/.rpm packages and just offer the FlatPak (could be a Snap I'm not sure). This just tells me they really dont understand the community and just wanted to ship something for Linux and be done with it.
I'm sure Cursor has more than few devs that primarily use Linux...
This what all developers want for a platform. They can release their software and not have to worry about some "maintainer" switching out dependencies out from under them introducing bugs and crashes in what they shipped.
Cursor ships as an AppImage.
Whenever I tried Windsurf Editor, or their plugin for vim, and Intellij, it didn't feel polished at all. The basic function of autocomplete felt much much snappier on Cursor, and even on GitHub Copilot for vim/intellij.
Linux builds are in the AppImage format.
Which makes a lot more sense to me than deb/rpm when it's just a single executable.
I find if I tell Windsurf to look at something it will, Cursor I sometimes lay everything out for it and it just doesn't even read it.
Ultimately though once you run out of requests on Windsurf it's very weak without Claude though, and the top up requests are burnt through too quickly.
So I went back to Cursor.
CURSOR shifted to a more agentic approach even for chat requests to reduce input tokens.
Previously, they used the good old RAG pattern with code dumps: Request with user added files -> Retrieval (when Codebase enabled) -> LLM requests with combined context from user and retrieval.
Now they seem to be doing something like this: Request -> LLM with tools to search code base and/or user-added files
I get constant search tool calls even for user-added files. Big reduction in input token but I think performance suffers as well.
WINDSURF is still willing to dump code into the context, which gives them an edge in some cases (presumably at a cost of input tokens).
Windsurf is willing to spent to acquire customers (lower subscription cost, higher expenses for llm calls). Cursor has a huge customer base and is working on making it sustainable by a) reducing costs (see above) and b) increasing revenue (e.g. "Pro" requests for 0.05 with more input and output token).
Is OpenAI worth the $260 billion valuation... No, of course not, they're losing >$4 billion a year.
Are Cursor and Windsurf going to ask plugin devs to push to their own plugin stores in addition to VS Code's? Will they rally jointly behind a single open store? They need to have an answer to Microsoft here, and for the good of the ecosystem I hope they do have an answer, but customers will flee quickly if they lose access to all the proprietary plugins and to the broader ecosystem.
They should and probably will soon, and if I were them I'd even consider giving plugin devs a cut of their paying customer subs if MS gets competitive about it.
> but customers will flee quickly if they lose access to all the proprietary plugins and to the broader ecosystem.
Agentic AI coding is more important to customers than VSCode's extension ecosystem. VSCode is who has to worry in this equation unless they ship the same tools in the next few months and heavily subsidize them.
For users who've already switched to the forks, the cost of switching back is essentially zero, especially if Microsoft begins introducing changes that break fork compatibility. In that case, the migration direction would reverse almost overnight.
Didn't they change names months ago? I know them as Codeium.
I think it's going to be fine.
This is xAI buying Twitter, with extra steps.
Cursor yesterday was a 45X for comparison (9B, 200M)
https://techcrunch.com/2025/04/16/openai-is-reportedly-in-ta...
So, I'd be inclined to believe the vast majority of the deal is stock (or whatever that is called pre-IPO).
Microsoft has clearly taken notice. They're already starting to lock down the upstream VSCode codebase, as seen with recent changes to the C/C++ extension [0]. It's not hard to imagine that future features like TypeScript 7.0 might be limited or even withheld from forks entirely. At the same time, Microsoft will likely replicate Windsurf and Cursor's features within a year. And deliver them with far greater stability and polish.
Both Windsurf and Cursor are riddled with bugs that don't exist upstream, _especially_ in their AI assistant features beyond the VSCode core. Context management which is supposed to be the core featured added is itself incredibly poorly implemented [1].
Ultimately, the future isn't about a smarter editor, it's about a smarter teammate. Tools like GitHub Copilot or future agents will handle entire engineering tickets: generating PRs with tests, taking feedback, and iterating like a real collaborator.
[0] https://www.theregister.com/2025/04/24/microsoft_vs_code_sub...
[1] https://www.reddit.com/r/cursor/comments/1kbt790/rules_in_49...
We've seen this before with Office.
We'll see it again.
Microsoft Build is this month [0] and it will tell where they are going next (other than price cuts).
I'm expecting disappointment for now, but also expecting GitHub Copilot to be upgraded. Then we'll see if they are ahead or so far behind.
If autonomous agents were just around the corner, then why wouldn't OpenAI bet on their own Codex product obviating (most) need for an IDE and save themselves the $3 billion?
Of course, back to reality. Today, at least in my workflow, I use / like Windsurf but it is a small part of what I am doing. For any code I want to keep I mostly write it by hand (using vim for a very bare-bones / cognitive mode experience). For me, the real flow state occurs in vim while ChatGPT and Windsurf are great for exploration.
this is the question i am still asking...
They don’t have access to copilot users in general, Microsoft and Google does. And perhaps they are realizing that Microsoft is hedging them over multiple LLM providers and maybe no longer feeding them juicy copilot data, with humans in a tight loop, correcting LLMs.
Have you used Cursor on a daily basis? I have. Every day for six months now. I haven't encountered a single bug that prevent me to work.
Moreover, while Microsoft tries to catch up lately, it's still very far behind, especially on the "tab autocompletion" front.
Microsoft provides the editor base, foundation models provide the smarts, and Cursor provides some, in my experience, extremely buggy context management features. There is no moat.
[0] https://knowyourmeme.com/memes/unfinished-horse-drawing-flam...
Maybe it's fine if you only do local development in other languages (Javascript?), but I completely swore it off.
Meanwhile GitHub web integration is approaching seamless in vs code. To the point I often forget I’m in a browser instead of the app, until an extension I use doesn’t work.
https://code.visualstudio.com/docs/copilot/copilot-customiza...
I gave up on Cursor because my trial ran out, while VS Code with Copilot doesn't seem to charge me anything.
I agree with the first part, I'm much less optimistic about the second part. I suspect they will create something that is worse, but cheaper if you already pay for Github/Office 365/whatever. Then many large enterprises will switch to save money whilst the engineers complain, just like with Teams.
I always felt that cursor and windsurf should be just extension to vscode instead of a fork. Was there some missing functionality is vscode that was missing? Is it still missing?
There are some extensions that work in this way and allow to use multiple implementations depending on task at hand without any long term commitment.
I feel like such fragmentation is by artificial just to lock users in single ecosystem.
It's in a lot of ways the OpenAI story itself: Can they keep an edge? Or is there at least something that will keep people from just switching product?
Who knows. People have opinions, of course. OpenAIs opinion (which should reasonably count for something, them being the current AI-as-a-product leader) is worth $3B as of today.
I would also argue that the product could be built over two weekends with a small team. They offer some groundbreaking solutions, but since we know that they work and how, it's easy to replicate them. That also means they have significant talent there.
Hence, they are also buying the employees.
The code base itself is basically worth nothing, in my opinion.
What groundbreaking solutions does Windsurf offer?
Or you chat and suddenly it wants to use the azure copilot instead because reasons.
Horrible experience.
I've tried just about every model on its own over the years, and yet there's something about the Cursor workflow that frequently still gives me chills when it shows me again that it had clearly anticipated what I would think next in a way I just don't experience with other tools.
Holistic seems like the right word?
If it's all smoke and mirrors as some folks imply, then it's Penn and Teller level smoke and mirrors. Beware those who tell you that they could duplicate anything of value in a weekend.
I actually find it a little reassuring that they can't seem to get out of their own way.
The fact that they are is not the results of the Microsoft takeover.
The MS acquisition traded the developer community to briefly appeal to enterprises, then quickly let both down.
And I have long held that they are hungry, shipping like clockwork on or about the 20th of every month, showing up with actual improvements all the time https://about.gitlab.com/releases/ It seems this month brings 18.0 with it, for whatever that version bump happens to include
They also have a pretty good track record of "liberating" some premium features into the MIT side of things; I think it's luck of the draw, but it's not zero and it doesn't seem to be tied to any underhanded reason that I can spot
I think the GitHub brand is still stronger and people just don't "care" about gitlab.
That’s why you won’t see a ton of work go into e.g. issues/projects on GitHub. Those features all already exist and are very robust in ADO, so if you need those kinds of things (and the reporting an enterprise would want to be able to run on that data), then you belong on ADO.
I don't like that GitLab lets you nest organizations and such, it makes it so painful to find things over time. I appreciate GitHub doesn't do this, I view it as a plus
I also disagree about GitLab CI, not that it wasn't smart for them to include alot sooner than GitHub, but Actions is really good and really easy to get up and moving with. I find they run faster, have better features - like they can annotate a PR with lint errors and test failures - with very little comparative configuration.
GitLab CI yaml is a mess by comparison. GitHub was smart to push things to the runner level once a certain complexity threshold is hit.
This has been my experience of course, and so much of it is really subjective admittedly, but I don't think GitLab is truly ahead at this point.
This reminds me of "big companies moves slow.." line.
Buying competition while everyone’s still fighting might straddle you with a lame horse
Tale as old as time, song as old as rhyme: embrace, extend, extinguish.
They are very different companies in structure and it certainly is a "pick your poison" but it's completely stupid to act like they're the same on this front. Apple is better on user privacy
...unless you care about state actors, which you should, in which case your data is the US government's either way.
Cursor and other forks have decided to circumvent this, some even going so far as to use proxies to bypass restrictions.
I'm not convinced Microsoft owes other billion dollar companies free access to a product they've built, curated, and supported for over a decade. Plug-in authors are not restricted from publishing their products on competing marketplaces.
However, given that JetBrains also have their own AI offering[2], I'm not sure how long that will last too...
[0] https://plugins.jetbrains.com/plugin/20540-windsurf-plugin-f...
[1] https://marketplace.visualstudio.com/items?itemName=Codeium....
1) Cline (1.4mil downloads)
2) Roo Code (a fork of Cline, 450k downloads)
Still a drop in the bucket compared to Cursor in terms of # of users, but they're growing pretty fast.
Disclaimer: I maintain Kilo Code, which competes with 1) and 2) so I'm pretty familiar with this space/the growth patterns.
We also have our own provider, which means no need to bring your own API keys (you can if you like, but it is batteries included by default) and we're not charging anything on top of the API pricing. Instead of monetizing on individual developers, we want it to be free for them and make money eventually off enterprise contracts [1]
[0]: https://blog.kilocode.ai/p/roo-or-cline-were-building-a-supe... [1]: https://kilocode.ai
Not sure how they'd do it considering you bring your own API keys. Can you link me to a resource?
What doesn't the current API allow plugins to do? I'm guessing custom UI stuff that lives outside a panel?
In fact, their own AI extension appears to be pluggable in and of itself. I think they see the value in being easy to adapt different AI solutions to rather than trying to only provide their own.
No, they should be LSPs so that they can be integrated into any editor, not just VSCode.
And autocomplete is the least interesting thing an LLM can do. Cursor’s UX isn’t the end game but has lots great features.
The ideal UX is still being worked out. It’s good that different people are building tools to try different ideas.
I am all for everyone adopting LSP, but the reality is harsh.
They should have restricted the Marketplace several years ago, however, they are doing it now.
With C++, they are part of MFC's, they are the legal owners, not like Google vs Oracle in case of Java.
Lastly, with AI Code IDEs I think yes, there is a case, the need for IDE might be very less. Like a steering on a self driving car.
Microsoft software quality has gone downhill recently, and I'm not going to bet on them delivering something more polished than WS and Cursor here.
Side: all images on Microsoft websites are low resolution! it's like they don't even check their own website.
Their “programmers” are more busy with making blogs and videos than functioning tests or technical documentation, and they start using JavaScript and Python for everything.
I’m not surprised their quality went to shit. There are some pearls left, C# in general is pretty good, and Aspire is becoming quite neat.
The latter I think mainly because David Fowler is just a great developer
Because if you're referencing to a headline (without reading the article) that was on H a couple of days ago, it stated that 20-30% of the code in the repos was written by software. Software != AI
To quote wongarsu in the same post: "Considering that most of their software has been developed for decades and AI assistants have only started becoming useful in the last ~4 years it would be very surprising if 30% of their code is AI written. I doubt they even touched 30% of their code in the last 4 years. But what is perfectly plausible is that 30% of their code is written by code generators. Microsoft has a lot of interface code. All the windows DLLs that are just thin syscall interfaces, the COM and OLE interfaces in their office suite and everywhere else, whatever Office uses nowadays for interoperability to allow you to embed content of one product in another, whatever APIs their online products use, etc. In the leaked Windows XP source code it can be difficult to find the actual source code in between the boilerplate files containing repeated definitions, and in the decades since then the world has only leaned more into code generation."
Probably.
> And deliver them with far greater stability and polish
That seems ... overly optimistic given MS's history.
I agree with the rest, they've all mostly lost market share or completely no longer exist due to VS Code, but not IntelliJ, that platform is going really strong.
Though no doubt, VS Code has pushed JetBrains to rethink some things, and be better in general.
They can have all the money in the world and it doesn't mean much in this context.
For while Microsoft is going to invest heavily in a Cursor / Windsurf like product and likely do alot to ship it in their editors - likely with exclusions or lag times between updates on other platforms - there's zero reason for Google to do this for example, when they could sell through Gemini for Code as an extension across all editors.
I don't see JetBrains having issues because of AI tooling, for most of these companies, its a boon to be on the JetBrains platform. Especially because JetBrains has lots of enterprise customers who would naturally be very interested in buying AI tooling for their developers. Its a natural market
Only for azure devops, there are +6k problems listed on developer community website with 500 still not closed for the last 6 months. [1]
The complete integration in the ecosystem is what's flawless.
Any company with a better product has to fight that integration and they almost always lose (Sybase, Borland, WordPerfect, Lotus, Netscape...)
1 : https://developercommunity.visualstudio.com/AzureDevOps?ftyp...
it was crap compared to Borland's products 20 years ago
and today it's crap compared to JetBrains'
and christ knows how anyone could consider the Azure UI to be "great"
other than Teams I don't think I've used a worse piece of software
I’ll agree on Teams being crap though, mostly for how dumb it is that they’ve rewritten it multiple times and created a confusing slate of weird versions like “Teams (work or school)”
Care to place a bet?
But I agree with you about the first part, and I think it's awesome for me as a user that all this competition to build a matter mousetrap is happening right now! I'm not as certain as you are that Microsoft will end up building a better version. It's definitely one of the likely outcomes. But it's also totally plausible that Cursor or Windsurf can win the race, even if they need to replace every single one of the MS extensions and entirely diverge the core IDE from upstream. These products are well capitalized and it's just not that hard to build the core pieces of an IDE.
I think a few options for this already exist, but honestly they don't go far enough. I want something like an AI scrum master, for hyper agile teams, that can task out smaller tickets to AI sub agents.
I would integrate this thing in with something like an AI powered Jira.
Two arguments exists.
1. I need to take about 6 months off and start building this now, even if I don't know exactly how I'll get it done. Between a combination of vibe coding and maybe a bit of outsourced work ( looking at Eastern Europe), I could get this done with my personal funds.
2. To do this properly would probably require tens of millions of dollars. I'll probably burn myself out trying to do it solo without ultimately getting to a sellable product.
The biggest issue here is to actually scale I would need to either have users bring their own LLM keys or have tens of thousands to spend on LLM tokens.
But I'm glad OpenAI is getting into the tooling space in this way. I cant wait to use all the cool features they build after VSCode rips them off.
I am guessing you are talking about GitHub Copilot when you say VSCode. GitHub Copilot is far far inferior product when compared to Cursor, Windsurf or Augment Code. Most people who try almost any Copilot alternative for a reasonable amount of time end up canceling their Copilot subscription. I did, after two months of using both.
To be honest I think both are quite limited by context length (in that they try to limit the context they send to the LLM and hence cost), and so I find myself using Gemini 2.5 in AI studio with the 1m context length, and asking it to generate instructions for Copilot (which seems to work pretty well)
Mentally, I'm replacing claims like this with "it will do magic!" and I think I'm just about as likely to be correct.
As for Microsoft tightening its grip on VSCode, yeah, that's a strategic play. It's the classic embrace-extend-extinguish arc we’ve seen before. But the community won't just roll over. If they start walling off features like TypeScript 7.0 from forks, the open source pushback will be fierce—and that could backfire hard.
The bugs and instability in Cursor and Windsurf are real, especially in the AI layers—but that's what happens when you ship fast. Microsoft might catch up and polish those ideas, sure. But raw innovation rarely comes from the behemoths—it bubbles up from the scrappy contenders.
And you're absolutely right about the endgame: the shift from "smart tools" to "smart collaborators." But we need both. Editors like Cursor are the testing ground for those future teammates. They're rough drafts of a new paradigm, not just forks of VSCode with AI duct-taped on.
Do they have the man power to compete with Microsoft?
Linux managed to do it but Linux is the biggest, most successful free software project there is. Firefox and its forks are a better example. If Mozilla stopped working on Firefox, the forks would be pretty much dead in the water: they simply do not have the man power necessary to maintain a modern browser.
Cursor blows copilot out of the water in my experience. Man power clearly isn't the most decisive factor in this battle.
Meanwhile JetBrains has IDEs that can meet or exceed the visual studio experience for tons of languages, and Windsurf has nearly achieved parity with their JetBrains plugin.
Is VS Code really the end all be all? JetBrains is private but may be worth around $7B. Cursor may be valued at more than that. I want to believe that Cursor or another competitor in the space could eventually build a better IDE than VS or VS Code.
I don’t see Microsoft taking the risk or initiative to fund another IDE, I feel like they will just keep jamming features into VS and VS Code. I don’t think they’re spending much of that $3T on developing next generation IDEs anymore.
I disagree, but would love to be wrong. These tools exploded onto the scene and were massive productivity helpers, but since their initial integrations they’ve churned rather than improved in the last 2 years. They are even worse when you try to iterate rather than just get them to one shot the problem space.
The last cycle I remember of this IMO is iPython -> Jupyterhub/Jupyterlab. Of course, iPython has existed for a long time, though that change was made because data was too big to analyze locally and it turns out it was more convenient to centrally manage kernels/images/libraries for convenience.
MCP servers and Cursor/Windsurf changed that a bit, but it will end up centralized again at some point (or at least aggregated, if it's not already?). People are passing around lists of interesting MCP servers now, and that will be out of fashion in less than 12 months.
> Windsurf began in 2021 as Exafunction, founded by MIT graduates Varun Mohan and Douglas Chen. The company initially focused on GPU optimization before pivoting to AI-assisted coding tools, launching Codeium, which later evolved into Windsurf.
> Series B (January 2024): $65 million at a $500 million valuation.
> Series C (September 2024): $150 million, led by General Catalyst, at a $1.3 billion valuation.
> May 2025: $3 billion acquisition from OpenAI
I wonder how much of the value is really from the model or the tooling around it. They all use the same models (mostly Claude, others have been horrible and buggy in my experience). Even co-pilot agent mode now uses Claude. The editor has their own LLM (?) that does the apply since LLMs often return snippets. They work well enough on Cursor. And then you have the auto-complete, which I think is their own model as well.
But the main value from me is from the agent mode and 95% of the value is the underlying model. The other stuff could be more or less a VS Code plugin. The other benefit is the fixed pricing. I have no idea how much 500 calls cost if I were to use the API, but I expect they're probably losing money.
> The other stuff could be more or less a VS Code plugin
The other stuff would take a team 6 months to implement. This is where the valuation comes from. Time to market, they are there TODAY.
I'm jelly. Very rarely you see in history someone lucky enough to be riding the absolute top of the wave. Even OpenAI took about decade to cook their breakthrough product.
Buying a "bundle" should result in a lower price, as compared to buying both tools separately, making the loses worse. Unless they can reuse some of the same infrastructure and save a lot of money that way.
It was smart for Windsurf to take the offer and to get greedy in this hype cycle. Unless Cursor is thinking that Anthropic or someone else will buy them for a lot more, its going to get extremely competitive as the switching cost for Cursor is zero and that ARR can disappear very quickly.
Copilot will attempt to destroy Cursor on price and functionality for however long they want to.
Very risky for Cursor at $9B valuation (which I think is overvalued and based on VC FOMO).
[0] https://techcrunch.com/2025/04/17/openai-pursued-cursor-make...
They have certainly lost the monopoly.
Microsoft is an existential threat to their model here, but with the money they each have coming in they together have the opportunity to make the whole ecosystem better by building out viable infrastructure for all VS Code forks, if they can cooperate.
That said, I have tried Windsurf multiple times, and it wasn't a pleasant experience compared to Cursor, which I've been using for more than 6 months as a paid customer.
I think that was when intel acquired McAfee for 8B in 2010.
i agree with you on this - it seems that openai hallucinates reality as much as their products do :-/
Oh, haven't you heard? Hiring people to write software is so last decade. Maybe they just didn't want to vibe code a Windsurf implementation and decided to buy a press cycle for $3B
How are you defining “these deals”? Most acquisitions of startup by larger companies in America over the last decade, at least, have been all cash.
In cases where the company being acquired is already publicly traded, those deals would have to be all cash as their shareholders would need to be bought out. IBM paid cash for Hashicorp, and Doordash will acquire Deliveroo in cash.
Okay, in that category of M&A in practically any category, the vast majority of deals are all cash. Deferred, for executives, in most cases. But cash.
> In cases where the company being acquired is already publicly traded, those deals would have to be all cash as their shareholders would need to be bought out
Not true. Preferable. Easier. Not not a requirement.
It's funny money / made-up value. This is not $3B cash.
- AI assisted coding is mostly about managing the context and knowing what to put in the context to avoid confusion and dumb mistakes, it's not about the UI.
- This signals that OpenAI believes that highly effective coding assistant LLMs will become a commodity / open source and so UI / tooling lock-in is a good investment.
they're acquiring one of the biggest the front doors to developers, with Windsurf - whether it'll _remain_ in fashion or not, that's a different debate. This can be like facebook acquiring instagram (if developers turn out to be the actual profit-driver niche for LLMs, which currently seems to be the case)
AI is definitely huge for anyone writing code, though one can imagine a model like o3 completely replacing 90% of white collar jobs that involve reading, writing and analysis.
Interestingly, o3 is particularly bad at legalese, likely not fully by accident. Of all professions whose professional organizations and regulatory capture create huge rents, the legal profession is the most ripe for disruption.
It's not uncommon for lawyers to bill $250 to $500 per hour for producing boilerplate language. Contracts reviewed or drawn up by lawyers never come with any guarantees either, so one does not learn until too late that the lawyer overlooked something important. Most lawyers have above average IQs and understand arcane things, but most of it is pretty basic at its core.
Lawyers, Pharmacists, many doctors, nearly all accountants, and most middle managers will be replaceable by AI agents.
Software engineers are still expected to produce novel outputs unlike those other fields, so there is still room for humans to pilot the machine for a while. And since most software is meant to be used by humans, soon software will need to be usable by AI agents, which will reduce a lot of UI to an MCP.
Honestly, same for doctors and accountants. Unless these model providers are willing to provide "guarantees" that they will compensate for damages faced as a result of their output.
Doctors and Lawyers are required in many areas to carry malpractice insurance. Good luck getting "hot new AI legal startup" to sign off on that.
The most obviously "lethal" case (cars) is already in large scale rollout worldwide.
At scale, self-driving car "errors" will fall under general liability insurance coverage, most likely. Firms will probably carry some insurance as well just in case.
LLMs already write better prose than 95% of humans and models like o3 reason better than 90% of humans on many tasks.
In both law and medicine there are many pre-existing safeguards that have been created to reduce error rates for human practitioners (checklists, text search tools (lexis nexis, uptodate, etc.), continuing education, etc.) which can be applied to AI professionals too.
That's how we will get to $20,000/month agents.
Wake me up when there’s any evidence of this whatsoever. Pure fantasy.
IDEs can support "AI coding agents" on their own.
The entire workflow for "AI coding agents" boils down to:
1. You write a prompt
2. The "agent" wraps it in a system prompt and sends it to the LLM
3. The LLM sends back a response
4. The agent performs specific actions based on that response (editing files, creating new ones, etc.)
Microsoft already started doing that with Copilot. And they have a vibrant ecosystem of VS Code extensions (I maintain one of them [1])
"AI agents" should be a feature, not a separate piece of software (IDE) that's integral to software devs.
I see LLMs trying to do stuff that doesn't work in every AI coding thing I've tried, despite 20 pages of system prompts! (Or perhaps because of it.)
"Gemini 2.5 Pro Preview (I/O edition)" https://news.ycombinator.com/item?id=43906018
Edit: Oh of course, it's the open weights model they've been teasing.
https://developers.googleblog.com/en/gemini-2-5-pro-io-impro...
Typical VI-fallacy BS. If LLMs were actually good they would replace IDEs completely not be integrated.
My current read is that this is a frontier lab acquiring large-scale training data—cheaply—from a community of “vibe coders”, instead of paying professional annotators. In that light, it feels more like a “you are the product” scenario, which likely won’t sit well with Windsurf’s paying customers.
Interesting times.
In my experience Claude Code is fantastic, both for answering questions about the codebase and coding.
I wonder what Anthropic makes of this. Windsurf was like a top 3 customers of them, might be a big revenue blow too?
I think the long-term play here is something to do with Agents and they are simply cornering the market because coding tools are part to it.
That being said, quick search around what people are building with these VIDEs reveals mostly landing pages that are actually not even that good. For the amount of money spent one could have easily bought a good template or pay someone to customise an existing one.
I don't know. Maybe I am dumb.
but undeniably these cos are all a great lesson in just how much cash lies in executing first/near first
There are some niceties about inline completion (like spelling out a log message that's obvious from the surrounding code) but I don't get the hype much beyond that.
Maybe I'm missing some feature though ...
AI autocomplete is the best thing I've experienced in developer experience in my career since git won over subversion.
I don't use LLM code prompting, but autocomplete is my jam. It's getting things right 90% of the time when I'm plumbing fields or refactoring. It makes life so much more pleasurable, and I say that as someone who is already using a statically typed language with robust IDE refactoring capabilities.
It's absolutely made me more productive.
Windsurfs on the other hand are much better. The only issue is that windsurf is super aggressive about them, but it is able to do do things like "the user made a change on this line, he most likely also want to make the change here".
The "space" exists for months, there are no people with 10y expertise here, with their brand they can attract any talent they can wish for in this "space", no?
You can probably vibe code 80% of it in a week or two?
Apparently, no. And the low quality of all OpenAI apps is proof of that.
Tell me what AI wrapper do I make that you would acquire my product?
My prediction is anthropic, google or amazon will buy cursor. The next logical step to coding is building apps.
For comparison, JetBrains generates over $400 million in annual revenue and is valued around $7 billion. They've built proprietary technology and deep expertise in that market over decades.
If AI (terminology aside) replaces many professional software engineers and programmers like some of its fierce advocates say it would, wouldn't their potential customer base shrink?
Professionals typically drive enterprise revenue, while hobbyists—who might become the primary users—generally don't support the same business model or spending levels.
What am I missing here?
OpenAI just had a fundraising round that put them at $300B. Maybe they're just giving Windsurf 1% of OpenAI. Maybe they're even giving less than 1% - if OpenAI was worth $300B at the end of March and $150B last October, maybe they're worth $400B now. Maybe Windsurf is getting 0.75% of OpenAI that's "valued" at $3B.
hiring is hard
it's a high-functioning team swimming in contemporary design and eng practices
code is emerging as an important battleground
OpenAI has the $$$
Looking for a moat in the technology is always a bit of a trap - it’s in the traction, the brand awareness, the user data etc.
Traction, brand awareness, and user data do not favor Windsurf over GitHub Copilot. The few of us who follow all the new developments are aware that Windsurf has been roughly leading the pack in terms of capabilities, but do not underestimate the power of being bundled into both VS Code and GitHub by default. Everyone else is an upstart by comparison and needs some form of edge to make up for it, and without a moat it will be very hard for them to maintain their edge long enough to beat GitHub's dominance.
Whether or not it's justified is a different matter, but for startups valuations are more about potential then current performance.
With $3bn budget you can replicate it in few months, promote for free using your own stronger brand and you're left with roughly $3bn in the bank to do whatever you want.
They don't have their own LLMs either, they've glued a 3rd party editor to 3rd party models. That's some expensive glue.
If I were any of these companies I would be suing OpenAI to try to get my money back. Thrive, ARK, Tiger and the others can pound sand
What's especially rich is the timing - right after OpenAI backpedaled on their restructuring plans due to "public pushback" (read: Sam Altman making yet another governance blunder). Now they're dumping billions into a tool that's essentially the same thing everyone else is building.
then the prompt is the coding, the reasoning is the execution, the code just an abstract layer that we do not care to much about i.e.: like assembly, machine instructions.
we know it exists, bit even here on hackernews i would guess only a small fraction know how it really works on a detailed level.
there will still be coding, instructions (prompt) -> execution (reasoning and AI code and code execution -> feedback (debugging to AI then and one point to the user)
bur actual looking at the code, well, thats only when this cycle annoyingly fails.
so current IDEs are still built from an code first mindset. this will not be the IDE of the future.
so basically OpenAI bought a Dinosaur
openai just seems to have a hole in their hand they keep temporarily patching up with new investor money
As this great blog post lays bare ("The Emperor Has No Clothes", https://ampcode.com/how-to-build-an-agent), the core tech of a coding agent isn't anything magic - it's a set of LLM prompts plus a main loop running the calls to the LLM and executing the tool calls that the LLM wants to do. The tools are pretty standard like, search, read file, edit file, execute a bash command, etc. etc. Really all the power and complexity and "coding ability is in the LLM itself. Sure, it's a lot of work to make something polished that devs want to use - but is there any more to it than that?
So what is the differentiator here, other than user experience (for which I prefer the CLI tools, but to each their own)? $3B is a lot for something that sure doesn't seem to have any secret sauce tech or moat that I can see.
Embrace & Extend will never die.
Spread too thin is often the final result of embrace and expand.
"hey Jim, can I use your credits? I have a deadline and I'm all out."
dtagames•22h ago