OpenAI’s Windsurf deal is off, and Windsurf’s CEO is going to Google

IMO other than the Microsoft IP issue, I think the biggest thing that has shifted since this acquisition was first in the works is Claude Code has absolutely exploded. Forking an IDE and all the expense that comes with that feels like a waste of effort, considering the number of free/open source CLI agentic tools that are out there.

Let's review the current state of things:

- Terminal CLI agents are several orders of magnitude less $$$ to develop than forking an entire IDE.

- CC is dead simple to onboard (use whatever IDE you're using now, with a simple extension for some UX improvements).

- Anthropic is free to aggressively undercut their own API margins (and middlemen like Cursor) in exchange for more predictable subscription revenue + training data access.

What does Cursor/Windsurf offer over VS Code + CC?

- Tab completion model (Cursor's remaining moat)

- Some UI niceties like "add selection to chat", and etc.

Personally I think this is a harbinger of where things are going. Cursor was fastest to $900M ARR and IMO will be fastest back down again.

I never understood why those tools need to fork Visual Studio Code. Wouldn't an extension suffice?

Cline and Roo Code (my favorite Cline fork) are fantastic and run as normal VS Code extensions.

Occasionally they lose their connection to the terminal in VSCode, but I’ve got no other integration complaints.

And I really prefer the bring-your-own-key model as opposed to letting the IDE be my middleman.

Using cline for a bit made me realize cursor was doomed. Everything is just a gpt/anthropic wrapper of fancy prompts.

I can do most of what I want with cline, and I've gone back from large changes to just small changes and been moving much quicker. Large refactors/changes start to deviate from what you actually want to accomplish unless you have written a dissertation, and even then they fail.