When Microsoft announced it was acquiring GitHub in a $7.5 billion deal in 2018, developers were nervous. Some feared Microsoft's control over the largest code repository platform, while others adopted a wait-and-see attitude. Nearly eight years later, GitHub is now fighting for its survival amid a surge of outages, security issues, and intense pressure from competitors.
In recent weeks alone, GitHub suffered multiple major outages, a remote code execution vulnerability disclosure, and a breach of its internal code repositories caused by a malicious VS Code extension installed on an employee's device. Current and former employees paint a picture of a company struggling with lack of leadership and mounting competition.
The roots of GitHub's current struggles trace back to last summer when former CEO Thomas Dohmke resigned, triggering a significant shakeup in how GitHub operates under Microsoft's control. Rather than replacing Dohmke, Microsoft directed GitHub's leadership to report directly to the CoreAI team led by Jay Parikh, a former Meta engineering chief recruited by Microsoft CEO Satya Nadella to spearhead the company's AI transformation. Parikh's decision not to appoint a new CEO has frustrated employees, who refer to themselves as Hubbers and have struggled to adapt after years of independence.
Since Dohmke's departure, GitHub has experienced a steady talent drain. Several employees followed Dohmke to his startup, Entire, a new developer platform that directly competes with GitHub. At least 11 of the 30 employees listed at Entire previously worked at GitHub. The exodus continues: veteran Microsoft executive Julia Liuson departed after 34 years, and Jared Palmer, who joined GitHub as senior vice president in October, is already leaving for Xbox. Elizabeth Pemmerl, GitHub's former chief revenue officer, also resigned last month. With revenue now reporting into Microsoft's Customer and Partner Solutions group and product work split into the Developer Division, employees feel there is no cohesive leadership team left. One employee said, 'There's basically no more GitHub at all anymore. It's all Microsoft, and the company is collapsing.'
The outages have been particularly damaging. GitHub CTO Vladimir Fedorov, who joined a year ago after eight years at Microsoft and twelve at Facebook, publicly apologized for the latest incidents. He admitted GitHub was struggling with a huge growth spike in pull requests, commits, and new repositories. The company is migrating to Azure servers, a project Fedorov initiated to address data center capacity issues, but the complex MySQL clusters have caused disruptions. Developers inside and outside Microsoft have expressed anger. Mitchell Hashimoto, creator of the Ghostty terminal, announced he is leaving GitHub after 18 years, saying, 'GitHub is failing me, every single day.'
Security issues compound the problems. In March, a critical vulnerability in GitHub's internal git infrastructure was uncovered by Wiz Research using AI models, potentially exposing millions of code repositories. Earlier this week, 3,800 internal GitHub repositories were breached after an employee installed a malicious VS Code extension. Microsoft employees note that VS Code frequently prompts users to install new extensions, and some with hundreds of thousands of installs have been pulled after infecting users with cryptomining tools.
GitHub also faces backlash over its move to usage-based billing for GitHub Copilot. Starting next month, every Copilot plan will include a monthly allotment of AI credits, with additional usage requiring payment. This shift could alienate developers accustomed to experimenting without cost concerns, as GitHub currently moves them to less capable models when limits are reached. The new system means users will be cut off unless they pay for more credits.
The competitive landscape is intensifying. Jay Parikh has privately warned colleagues that GitHub 'faces a critical threat' from rivals like Cursor and Claude Code. While GitHub Copilot initially led the AI coding tools race, it has fallen behind over the past year. Microsoft reportedly considered acquiring Cursor to close the gap and has canceled many Claude Code licenses to encourage developers to improve Copilot. Meanwhile, upstarts like Entire are positioning themselves as alternatives.
The pressure is now on Parikh and the CoreAI leadership team to restore GitHub's stability and innovation. If they fail, Microsoft risks losing the developer community that was instrumental in its resurgence. The race is on for competitors to build the next GitHub and capitalize on Microsoft's struggles. As one employee noted, the company's reputation has been 'torched' by outages and security failures.
Beyond GitHub, Microsoft is making other changes. The company is retiring Teams' Together Mode in favor of a streamlined interface, rebranding Xbox to all caps XBOX, and testing a resizable taskbar for Windows 11. Leaked images reveal new Xbox Elite 3 and Cloud Gaming controllers. Microsoft also mourned the death of former Developer Division chief S. Somasegar at age 59. Xbox fans have voiced demands for exclusives, more backward compatibility, and free online multiplayer. New Surface devices with Intel chips launched at higher prices, while Logitech's MX Master 4 now supports Windows 11 haptics. Microsoft is phasing out SMS codes for personal accounts in favor of passkeys, and the company appointed its first chief design officer, Jon Friedman.
GitHub's fight for survival is emblematic of the broader challenges Microsoft faces in integrating acquired companies while maintaining their culture and technical excellence. With developer trust eroding and competitors gaining ground, the next few months will be critical for GitHub's future under Microsoft's wing.
Source: The Verge News