But the Windsurf acquisition sat on ice for months. According to The Wall Street Journal, the holdup was due to Microsoft, OpenAI’s mega-partner in everything, wanting access to Windsurf's intellectual property. The cloud giant had been using OpenAI’s models to power GitHub Copilot since 2021, and the product had become a highlight of Microsoft’s earnings calls. But as Cursor, Windsurf, and Claude Code offered new agentic coding experiences, GitHub Copilot was starting to feel stuck in an earlier era of AI. OpenAI coming out with yet another coding product wouldn’t help.
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The development is the latest development in a disagreement between the Pentagon and Anthropic over how the Trump Administration’s use of its AI technology with big implications for the control of AI overall and the relationship between business and government.