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Comment by huijzer | Hacker News Reader

Relatedly, I think many people overestimate how hard it is to compete with the big players. People think that because they earn billions, they are unbeatable. But this is untrue! Scrappy, creative people who just go for it can often beat the big players. As a recent example, look at Cursor AI. Microsoft was in the PERFECT place to come up with Cursor. Microsoft had the most AI knowledge via their own teams and via OpenAI. They have enormous data centers for AI compute. They had the most used code editor (Visual Studio Code). And still Cursor came in and made a better product!

Jeff Bezos said "your margin is my opportunity". I think we can say the same for bureaucracies. Whenever there is a bureaucracy, think "your bureaucracy is my opportunity."

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> And still Cursor came in and made a better product!

On a long enough timeline Microsoft wins this battle. I don't think you appreciate the inertia of market dominance and a massive existing user base. They can simply copy features and push them to millions of developers overnight. More likely, Cursor either gets acquired or becomes a niche alternative while VSCode maintains its dominance.

Competing with established players when you have zero moat is always tough and I don't think Cursor are even close to winning their category yet. Bureaucracies exist in large companies precisely because they've grown successful enough to need them. While they do create inefficiencies, they also enable consistent execution at massive scale - something startups often underestimate until they try to grow beyond their initial niche. It may be slow, but they win by outlasting, outspending or buying you.

However if you simply mean that Cursor can carve a niche quick enough to become an attractive acquisition target then I might concede that fact.

> On a long enough timeline Microsoft wins this battle. I don't think you appreciate the inertia of market dominance and a massive existing user base.

So Cursor shouldn't even have tried? It is pointless what they have achieved? That's what you're saying?

I disagree. Having people who know about your product and have a positive experience with your product can be very sticky. Coca Cola is a famous example. Also look at AWS. Microsoft has many of the benefits you said. Microsoft has scale, many existing relationships with customers, own much of the related software, and many more benefits. Still, AWS has a 31% market share while Azure has only a 20% market share. The gap becomes more narrow each year, but it's still not closed. There is definitely a huge benefit to grabbing market share by having a superior product. Even while you only temporarily have that.

You also talk about the economies of scale, but that was my point. Even while Microsoft had all the economies of scale, still Cursor came in and took a large part of the market!

Did you just speak for the parent commenter and then disagree with yourself?

On a long enough timeline, Microsoft buys your company. It's a win-win

It's a win-win for Microsoft and the developer, but not for the consumers. It's better if someone else buys the company.

This basically describes Slack vs Teams as a case study. Teams launches, Slack says "good luck with that," MS basically gives Teams away for free and gains market share, then SAP acquires Slack.

Should be illegal imo

It probably is internationally, right? There are anti-dumping laws after all. But nobody follows them.

> then SAP acquires Slack.

Doesn’t change your point, but small correction: Salesforce acquired Slack, not SAP.

I use copilot at work. Why? Corporate IT/compliance. Getting cursor vetted ain't a hill I want to fight for.

This sounds horribly restrictive.

I don't even use copilot (yet) because the process of reviewing it through all the different obstacles (security, legal, budget) is on it's 24th month or something. I think many people in traditional industry can relate.

Corporations having IT governance and some restrictions on what apps you can install on company hardware is not remotely new or surprising.

Sometimes it causes issues, 99% of the time it's fine.

It seems like it ought to be reasonably restrictive to install some new AI tool on dev machines.

* they don’t know who’s behind it, what’ll it output?

* they don’t know the business model. Is will it be used to exfiltrate code from the company, aka train on the company’s codebase? Other text files you open?

I’m not at all saying I think Cursor is doing that—training on customer data would be a completely unethical business practice, bordering on malware, usually companies whose names get bounced around here are not so bad. But, the hypothetical host company doesn’t know anything about them, so it is prudent to require some checking.

I’m not sure of any company that blindly allows software like Cursor, that explicitly uploads code/embeddings to their servers.

Theory of the firm states that the corporation will get as large as coordination costs allow, but the other way to view that is that large corporations need to compensate for their increased coordination costs in some way.

Empirically, they can often do that successfully, as evidenced by the fact that large cloud providers are, indeed, large.

But you correctly point out that over time this almost guarantees opportunities for firms with lower coordination costs.

Is Cursor really better? I tried it briefly but bounced off. I’m convinced that AI-assisted search and replace would be quite nice sometimes, but not enough to switch.

Then again, I don’t use most features in Cody, either. Basic AI code completion seems good enough for me and the fancier shortcuts don’t stick.

As an original bouncer, and recent convert, I would emphatically state that Cursor’s AI for coding is much better.

I must be holding it wrong. It consistently gives me low quality code / changes. I try it about once a month for a handful of hours.

The code somtimes runs, which is a large improvement over recent years, but generally doesn't do what it's supposed to do.

And this is using claude 3.5, which works dramatically better for me in a chat session where i give it exactly what i want it to look at.

I just haven't found a way to be productive with it yet.

I've even tried the usual tricks of forcing it to write comments about what it's attempting to do throughout the code, but even then, fails.

Same, completely overhyped in my experience

I have mixed experiences with the "chat" portion of Cursor AI. The "composer" has been much, much better, albeit on greenfield projects. I haven't explored it too much with existing monoliths, but I suspect it might not fair as well.

I'm currently using it to build an iOS mobile game, using Swift. I've never coded in Swift, or used SpriteKit, but it's going surprising well. When it does produce invalid code, I just copy the error directly out of xCode into Cursor Composer and 9 times out of 10, it fixes the issue first try.

I've used it on different languages, but the rust it produces, even if it runs, is often full of bad decisions. Choosing improper data structures, cloning everything, etc. Curious what the quality is on the scale of "running swift" to "good swift".

YCombinator was premised on the hypothesis that competing with the big players is easier than you think.

wisely so, the bar is alarmingly low in most spaces.

I don't think so. The amount of features something like Google cloud has + experience is not cheap to just build.

Plenty of companies try in Germany the schwarz group aka Lidl and the German Telekom too.

Also normal companies are not fast. It takes time for them to learn about something new, understanding it and then implementing it before they finally can us it.

If Ms tells you they will do it in 1-2 years everyone is fine with that. And GitHub announced GitHub spark. Google has this already.

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