I'm not sure I agree with this because even though Cursor is pay north of 100% of revenues to Athropic, Anthropic is selling inference at a loss. So if Cursor builds and hosts its own models it still has the marginal costs > marginal revenues problem.

The way out for Cursor could be a self-hosted much smaller model that focuses on code, and not the world. This could have inference costs lower than marginal revenues.

Basically the same as MS & Social Media did: build a proprietary silo around data, amass enough data, so it will become too big an inconvenience to move away from the first provider.

It's good that the EU has laws now to ensure data interoperability, export & ownership.