The AI Coding Shakeout Is Here

Two major AI coding events this week signal a market shakeout: SpaceX struck a deal with Cursor including a $60B acquisition option plus access to xAI's Colossus supercomputer, while Roo Code announced it's shutting down its VS Code extension and pivoting to a Slack-based cloud agent. Both moves stem from the same pressure — foundation models are commoditizing, and model providers like Anthropic and OpenAI are now competing directly with tools built on their APIs. The author argues the IDE is not dead, that model lock-in is the real risk, and uses the moment to position Kilo (an open-source, model-agnostic VS Code extension forked from Roo Code) as the alternative to closed, vertically integrated ecosystems.