SED News: Restricted Models, IDE Wars, and the DeepMind Mafia

27:08Gregor Vand:I've got to apologize and say like we've disconnected from Peri. So really messy, that one. It's probably hard as an investor, too, right now, too, to kind of like navigate such an influx of companies. Like, how do you kind of differentiate between what's real and what's not real? I guess that's always been something that investors have to navigate. But it's probably particularly true because I think some of the things that they might have used, especially to like evaluate early stage teams are not necessarily the case now. Like you can create a really compelling early stage product rather quickly at this point.

27:42And you probably have to look a lot deeper than just what the product experience is and things like that to sort of evaluate the opportunity.

27:50Gregor Vand:Yeah. For one of the first times in history, I would probably not want to be a VC right now. So I don't know. I just, yeah, having to pick through all these products and like try and figure out like how is it actually made and like what's the real quote USP here like that isn't vibe coded by someone else or can be vibe coded by someone else tomorrow. Like very challenging. So one of our final headlines this week, really just about SpaceX, but you know, lots being talked about SpaceX elsewhere. More, we're kind of more interested in their acquisitions. So some may have seen already Cursor. They're probably some people's favorite coding tool was actually purchased by SpaceX.

28:30Gregor Vand:We're going to get onto that in the main topic. So we're not going to like touch on that one too deeply right now. But SpaceX also acquired a company called Mesh. So this is more of a sort of hardware tech company that builds optical links like on the ground as opposed to. so this was ex-spacex engineers who built optical links that connected starlink satellites but they sort of they think that they've seen that the same technology can speed up data centers on the ground so yeah we're like with this sort of influx of cash from their ipos i mean two big acquisitions i mean if i just look at the cursor amount of everything was 60 60 billion yeah i'll just call it i think that's way overvalued but like that's just me so i have to assume that maybe this was maybe also slightly overvalued in its purchase as well.

29:20Gregor Vand:So just kind of throwing money at it when they don't have to think too hard about money. I mean, that might be some of it, but I also think that if you kind of look at the potential of this, SpaceX is already selling compute to places like Anthropik, Google, and so on. And then they can own the actual network layer amongst us. This is kind of like where NVIDIA is very much owning sort of the GPU and the chips. If you can own the network layer, which is another huge area of cost for these data centers, then that could be a gigantic, like total addressable market. And if these data centers continue to grow and people are investing in them, like you're going to need ways of transferring the data and you can own essentially that layer that's responsible for transferring data.

30:03That's, that's massive.

30:04Gregor Vand:Oh yeah. I mean, I don't, I don't sort of disagree dispute why they would buy a company like this for sure. Yeah. I mean, actually cursor is more than one I'm like, we'll get onto sort of the, the why's there. Right. But yeah, Yeah, this one, Mesh, certainly sounds like a quote sensible play from the sort of the Y. I can't see if I can find how much they actually paid for Mesh. Let's come back on that one. But it still looks like a slightly more strategic purchase than Cursor. We're going to get onto Cursor and just dev tooling in general in the main topic in a second. Our final news item, it did hit the main news, was just Anthropic launching another product, which sort of starts to cut into specialized products.

30:43Gregor Vand:It's called Claude Science. And this is a product that enables rich scientific artifacts to be sort of fully reproduced and visualized. So CloudScience says like generates figures and manuscripts alongside the code that created them. It can natively render rich scientific artifacts, including 3D protein structures, genome browser tracks, chemical structures, and more. And yeah, this is just, I guess we've seen this a few times now where Anthropic like cut into a specialized... Is it finance? Is it legal? Exactly. We saw the finance. Exactly. Yeah. So I've got to say, I'm not super familiar with the sort of scientific software space, but I can imagine it's maybe a little bit stayed in places.

31:25Gregor Vand:And so suddenly when you've got someone like Anthropic coming in and saying, hey, we can just bring our like might into this area, like that sounds maybe really helpful. But equally, like if you're a specialized scientific software provider, this could look a little bit concerning as well. yeah potentially i do think that at least some of these launches that anthropic has done into specific verticals people have kind of over indexed on oh my god this is going to like change the entire industry it really kind of reminds me of like the early days of google when everybody was like every time like google moved to do anything with some random 20 project everybody's like oh my well i guess all those companies are dead like here comes google but i think part of it's like Where are their focus areas and also where are their expertise?

32:12Clearly, Claude Code is so amazing because they own the model, and then they also have a ton of people who are actively using Claude Code to both develop the anthropic technology and also feed back into the software that they use to build the technology. There's this huge, massive feedback loop. I doubt that they have that when it comes to some of these other domains. Maybe they get there, but I'm a little bit skeptic. Like I haven't, I just haven't seen the, you hear the launch, people freak out about it. And I like, you don't hear anything about these particular tools after that.

32:46Gregor Vand:Yeah. Yeah. That's a very good point. I mean, I haven't been tracking, say the finance suite that Aetherapy came out with. I think when you sort of move out, move maybe slightly outside of having been like a, I went back to builder mode, you know, before I joined Superbase. I was very alert to like what these companies were doing and how the products were actually netting out. because it always affected you if you sort of felt like you're building something that Anthropoc or OpenAI were going to come and sort of annihilate. But yeah, we'll sort of follow along. That might be another sort of deeper topic that we can do in the future, actually.

33:19Gregor Vand:So speaking of main topic, we've actually covered a lot of headlines today. So this might be a little bit shorter than usual, but we just want to look at the, if you want to call it the IDE wars, but round two, because last time we looked at this, it was kind of interesting. We're only talking maybe like a year apart, but the IDE wars round one was like Cursor versus Windsurf. And in both cases there, it was like, well, they're both kind of derived off VS Code. And then where do they go with this? And what's the tools that will sort of quote win the day? And like, we just are in such a different place now.

33:55Gregor Vand:Cursor has, as we mentioned, just been purchased by SpaceX. So I think really what we're focusing on here is just the fact that who actually owns your dev tool chain now? Like it's this idea of, well, depending on kind of your, if you want to call it top of funnel for where you write your code, you're also buying into effectively an ecosystem quite often run by that company. So the obvious cases are like Cloud Code from Anthropic and Codex from OpenAI. you know you use those tools where you're basically buying into the models that they themselves run and sell you and and are making a lot of money from and so you're kind of like what is your incentive to break away if you're if you're sort of seeing success you know from building with those tools you're less likely to want to like break out of that because you're like well this is working so well i don't know how well the other one will work and so on and then cursor what's the a strategic strategy there, I guess.

34:56Gregor Vand:Well, SpaceX has, you know, XAI, its own, and Grok, no, sorry, Grok, there's two Groks, that's why I always get confused. There's one Grok who got bought by OpenAI, which was more infrastructure. And then there's the other Grok with a K, which is within SpaceX. That's more like the chat version, I guess. But again, you're buying into that ecosystem now with, or it's assumed with Cursor, that if that's where you're going to be writing your code, you're probably going to be signing through to spacex models then there's the other option which is you go fully open source and the open code has actually been like really ramping up it's apparently 160 000 github stars 7.5 million monthly active developers and the point is it offers it's model agnostic it actually it gives you access to like 75 providers so you're not in theory you sort of quote locked in if you're using that sort of tool chain so yeah we're just going to back to this situation where you're sort of almost working in like a closed ide environment versus open i thought we'd like left that that town a while ago but here we are we're back again yeah i mean there was a time like now it's like what you were saying in terms of with certain choices you're buying into the whole ecosystem and kind of being vendor locked in it's like okay i going to use Cloud Code, which means I'm going to use Cloud as my model as well.

36:19And then I'm going to essentially have my contextual data associated with that particular development experience. And then it was similar at one point in terms of languages and IDEs choices as well. It's like, I'm going to use Microsoft's version of C++, which means I have Visual Studio, and I kind of locked into that ecosystem. Or even a bigger example would be something like the early days of C Sharp. The only IDE I could write C Sharp in and the only compiler available was also from Microsoft. And it happens to be code that is most easily run on a Microsoft Windows machine. So you're buying into this whole ecosystem.

36:58And then over time, that has changed where most of the languages, basically every language became open source. A lot of the IDEs, if they're not free and open source, there is a free and open source version of that. and it became no one that I think feels particularly vendor locked in. I wonder if this is like sort of a common trend and wave that you have with any software innovation is that at the beginning you have these kind of like locked in experiences because maybe there's an advantage early to being able to build those and it's harder to build sort of the separated, decoupled version of that.

37:32But that happens over time. You mentioned the open source tools.

37:38Gregor Vand:Open code, yeah. Open code, yeah. So there, I feel like every four to six months, there's like a new hot open source coding project that like gets all kinds of GitHub stars and grows really quickly. And then there's like a new hotness. You know, I would assume that eventually some of that stabilizes as well. Yeah, I think it probably will. I think developers are still open to experimenting with these like different tool chains. And as we covered, I think on last SED news, just the cost. so okay it's making lots of money for anthropic and i think somewhat open ai but certainly anthropic are just like killing it right now on on cloud code and the amount of money that companies are spending through that but i think you know what we were saying last month was you know what is the what is the tipping point for companies actually saying okay like we've got a rain in spending here or you should go and find an alternative tool even if it's a bit slower or like quote the quality is a bit less but like we can't sort of continue on this sort of just always going to be using the like the hottest latest model is that's quite like also the most expensive so the question with open code and kind of the model choices is there was like some head to head comparison on builder.io and like open code was apparently 78 slower than than cloud code so i think we've got to kind of look at that that sounds pretty drastic right but like i think if we cloud code's not exactly fast yeah so i can see where developers just like if they're sitting waiting for this thing like open code to like chunk through with a with a model of choice and they're just like why am i doing this why am i not just using cloud code is it just because my employer doesn't want to pay for it yeah i would say like you know maybe 78 slower is not ideal but like some of the efficiency or latency issues is a little bit hidden because these experiences are async.

39:31Like a lot of people that I know that are fairly advanced, like at using the agentic engineering tools, you know, they're running four to six agents simultaneously. So they're giving direction and then skipping over to some other tab or experience and giving direction there. And it's a lot of like sort of babysitting these different agents. So it's not like you have to just say, like, give a prompt and then go for a walk for 30 minutes, like the old days of, you know, compiling large pieces of source code, and then come back. And it's like, okay, well, now I put in my next response. Like, I think you can actually, you know, do something.

40:07And even if it turns away, it takes some time to compute. You're doing other things in the meantime, like there's other things that you can be doing. It doesn't require 100 % of your focus. I think that is a big change. Also, in terms of the developer experience is like, classically it's all about getting in like the zone not being distracted and now it's a lot of like context switching and like flipping between tabs in your in your terminal or different experiences within the within your ide or something like that so i think that changes things as well but not to say that you you should probably aim to be a little bit faster but but there there's less concern there but i think like one of the things that's interesting about all this though is that so much of the value that you're creating when you're interacting with these tools is sort of the data and the context with which you're building around it.

40:55So that becomes somewhat like the vendor lock-in even more than the model and the experience itself. It's like, if I needed this, like what is the switching cost? Like if I want to go from quad code to anti-gravity or open code, do I suddenly lose all this rich history and context that I've been building up? This has become my buddy. How do I manage? That's something that has always been an issue in all software. It's like, okay, that's why databases are so sticky, because the migration cost of a database is really expensive. But it's something that all companies ideally want to, I think, have the flexibility between vendors.

41:32And I wonder if there's going to be a market for creating an abstraction layer, essentially, that manages all this context and data that gives you like a vendor agnostic way of delivering that context across these different

41:45Gregor Vand:surface areas yeah absolutely i mean yeah i mean i i use cloud personally and and we have a work subscription but i've obviously got less i've got i've got more choice on the personal side in that sense but i still you know the fact that it has memory and yeah i do kind of like i'm just going to keep using cloud because yeah well hey it's got all my chats and it can reference things back and so on. And that definitely comes through on the code side as well. I think the question also here is just the neutrality piece with Cursor. They were always seen as this neutral company, quite frankly, because they were like VS Code, but we're a separate company.

42:27Gregor Vand:We've done a whole bunch of changes to the underlying VS Code open source. And then you can choose your models that you work from. And I think the big question now is, A, will that continue? Or is cursor auto mode? Is that now always going to go through Grok? And is it always going to be on SpaceX-owned infrastructure? I can also just correct myself that, because Grok with a K is SpaceX. Grok with a Q, which was the other one I was referring to, it was actually NVIDIA. They ended up partnering with NVIDIA on the Infra side, so not OpenAI. But yeah, Grok with a K, which is within SpaceX. Yeah, it just means that if you're now using cursor, what does that look like?

43:06Gregor Vand:And quite frankly, I used to use cursor less so over time for various reasons. This is just like another reason I think I would start to think twice about using cursor, unfortunately. Yeah. Clearly, there's also a market for companies that don't want to send anything potentially over public internet or to cloud vendors as well, where they're going to be in an air-gapped environment or they run on-prem banks and so forth. Like I talked to lots of customers in our world that they're running their own LLMs and then they need a tool that's going to like an engineering tool that's going to work in that environment as well.

43:44So there's clearly a market there. So it doesn't necessarily need to be like one winner takes all.

43:50Gregor Vand:Yeah. And again, I think we should we should do like a deeper topic on this on SED news. But yeah, open weight models, like they are just becoming like dramatically cheaper. I mean, obviously you can run them in different places, but, you know, roughly speaking, saying that like DeepSeek V4 Pro, it's like come down to like, is it 44 cents per million tokens? And whereas like Claude Opus 4.7 is like for the same thing, like$5. So it's like, there's like an AX difference to using Claude versus DeepSeek. and again anecdotally i think developers are saying like well we're actually starting to see some really good results coming out of these open way models so it's it's definitely something we have to to watch very closely because like if there's a tipping point where whoever's like running these for a developer that that tool chain becomes as say quote as good as like cloud code and you can you know convince your say company like there's no challenges here like it's just eight times cheaper that's that's pretty huge so yeah i mean i think it's interesting to to have looked at this in terms of yeah we're curious like what are you guys using out there audience like always like if you've got very strong opinions on this that we always love to hear them so we're always just trying to sort of report back what we're seeing day to day and and i say to go from a year if you'd said a year ago like basically cursor and windsurf would almost be sort of quote taken off the market i would i wouldn't have believed you but so yeah i definitely didn't predict cloud code and codex but cloud code especially like sort of taking over the ide space and and that sort of cli first for all builders you know that really just seems to be winning winning at the moment very interesting to see but yeah let's get on to our favorite part of the show hacker news highlights do you want to kick us off sean Yeah, sure.

45:45So I found this article that was about HackerRank had open sourced her ATS or application tracking system. And this guy did sort of a deep dive, Sam Bell, I think is his name, deep dive into using the applicant tracking system to analyze its LLM capabilities of analyzing his own resume. So he had scored like 90 out of 100, but he basically ends up stress testing the resume screener running the exact same test over and over again, like 100 times. And he had scores that range from like 66 to 99. And then the articles were interesting because he brought he like breaks it down. Like, where was the LLM sort of consistent and where was it all over the place?

46:28So things where the LLM did a good job was, you know, a checklist of like, do you know Python? That's pretty easy. or categories requiring judgment though, something like, are these projects architecturally complex, which a company might care about? They're completely subjective and basically the equivalent of a coin flip with the LM. So the takeaway here, of course, is LM's are great at parsing. They're great at pricing matching. They're terrible at subjective evaluation, which you shouldn't essentially ask them to do, especially if you're depending on getting some sort of score associated with it.

47:02It's just not going to be dependable metric.

47:04Gregor Vand:yeah super interesting yeah i wonder what would happen if i put my resume through that yeah well it depends you might get anywhere from 66 to 99 yeah exactly so on my side we have it's yeah it's a partial port of kubernetes to the browser which is kind of interesting so this is actually by another was another sam actually but ngrok so ngrok have kind of released this and what they stress is this is not like full somehow gzip kubernetes running in the browser but it is a partial port of kubernetes a kubelet binary so it's enough to run pods and prob them basically it's got ports of several kubernetes controllers so it's got a pod scheduler it's got namespace controller kub proxy deployment controller and a bit more and then it's got a browser-based take on you know this the cni the container network interface so like pods can talk to each other and then it's got like a browser-based container runtime which the kubelet can talk to over the container runtime interface so it's kind of and yeah i'm sorry and just to round out an api for interacting with the webernetis which is what they're calling it webernetis cluster to do things like apply manifests and and watch resources so it's super interesting i think this sort of angle here is is a little bit more on like education for example like it's quite difficult to learn kubernetes and so like if you can do a lot of understanding how things operate and interact with each other in this sort of lighter more interactive environment i think that's that's part of the the thinking here but yeah super cool and in fact it just comes via ngrok you can kind of assume it's actually pretty well put together yeah that's fun i also liked i just have to highlight one comment that came through on that which was i think the name is duncan gh and they commented investing early in this HN post before it's a banger instant classic so I just love that yeah this is like as this person says a classic HN article it's definitely why it made made my my highlights this week yeah hacker news was of like a port of a difficult technology to some other like four factor just like like the mirrored of uh doom ports that we've covered yeah exactly yeah and the last thing I had was this article token maxing is dead long live token maxing i saw that yeah yeah yeah so it's basically what the writer is saying is that originally people were token maxing because we were encouraging developers to consume huge amounts of tokens we're creating kpis within companies for them so a lot of it was like wasteful use of tokens and essentially what the the author is saying is that now we're getting we're maxing out tokens not because of wasteful token maxing but because actually something they term compound correctness So as these coding agents improved, we actually spend more tokens increasing the likelihood of better outcomes.

50:02So if you spend sort of more time on compute, potentially even spend more money on expensive models, then it might cost you more over, say, a five minute period versus a cheaper model. But with the cheaper model, you have to do more. You're basically wasting more tokens because you're doing more throwaway work. You got to do more iterations, whereas you're able to get it right sort of the first time is the argument.

50:23Gregor Vand:yeah so the whole like one shot still sort of holding up is more of like that's where to aim versus just rinsing tokens on cheap models basically yeah yeah my final one there's a lot of sams today am i am i reading this correctly yeah literally so the ngrok one i talked about was was by a guy sam rose uh this is now sam wilkinson yeah okay so three sams great so this was rf hacking my cloud-controlled ceiling fan so a while like there was quite a quite practical application this isn't just a sort of like off the deep end this was like someone who had moved into i think a new house and there was a rickety old ceiling fan on there and he was like right i'm just going to put a new one on but as with most sort of smart devices these days like It has to go through a cloud service to run if you want to use any of the smart home features.

51:21Gregor Vand:So yeah, but I mean, I won't go into all the details, partly because I'm definitely no RF hacking expert, but you can be sure that this article has an amazing array of how they decoded the RF signals and figured out how to then set up a transmitter box that could then control this specific fan. And I definitely can relate to this. I have various ceiling fans where I live in Singapore. And if I could get them hooked up without a cloud connection, that would be kind of nice. So unfortunately, I don't plan to go through all the steps that Sam Wilkinson did. But yeah, if you are so way inclined, then that's, yeah, samilkinson.io.

52:00Gregor Vand:So yeah, thanks for posting that. Yeah, very cool. I wonder if like with all these tools that we're talking about, you know, cursor, quad code everything if there be it kind of opens up access for a lot of these like side hacker projects that maybe you could have done but would take too much time and energy to do previously like i haven't tried this like can i have claude like hack my google nest cam to do something you know new or some piece of hardware or something that i wouldn't you know normally spend time on like can i just send off an agent to do some of that work yeah no for sure maybe maybe I'll have time looking ahead.

52:36Gregor Vand:I'm off to Scotland in a couple of weeks for the month, for the summer. So that will maybe give me some time to hack away on some things that I always struggle to. There you go. I expect me to be covering you in the Hacker News session with your latest ceiling fan hack. Maybe that's a goal. Yeah. By the end of the year, something that one of us produces in our side project world ends up there. But yeah, any other, I don't know, predictions, thoughts for the next month? I think we're going to, this is not the last that we've heard about like the government, you know, essentially non-US government is concerned about the US government controlling deployment of models.

53:13It would be my prediction. I think this is going to be a big topic of conversation for the foreseeable future.

53:19Gregor Vand:Yeah, for sure. On my side, yeah, I'm curious to see if like cursors it's reported like cursors usage goes off goes off a cliff maybe not i'm just going to kind of put it out there that's something i'll watch and we'll come back to i'm just curious how a deal for this a what a was it really worth 60 billion sorry i don't believe it was and b like i think there's a people who would try to avoid any product that is musk related just to be honest i do have a lot of like macro respect for him in terms of what he's achieved in many areas but i I think there's all sorts of other areas. I just couldn't agree less.

53:53Gregor Vand:And I think I've got so many other options on this product. I'm going to use something else. Yeah. Yeah. Makes sense. Right. Well, a lot to cover there today. I'll be seeing you in Singapore next week, Sean. And we'll catch up then again on SED News in a month's time. So thanks. Thanks, everyone, for tuning in. Thanks, everyone. Cheers.

54:21Thank you.