Perplexity Abandons MCP Protocol Internally, Citing Context Window Overhead

At the Ask 2026 conference, Perplexity CTO Denis Yarats announced the company is moving away from MCP internally due to tool descriptions consuming 40-50% of available context windows before agents begin work, and authentication friction across multiple services. The disclosure highlights growing pains in the agent protocol ecosystem even as every major coding agent now runs the same core pattern of active codebase exploration and multi-agent coordination.