Excellent comment via pcworld regarding Morro (kudos to avdude15):
Just what we need – a security mono-culture.
If Microsoft's free av product succeeds it will knock more than a few av developers out of the market and weaken the rest. This at a time when the more innovative players are investing heavily in the infrastructure and technology to deliver protection as a service. Cloud scanning, reputation systems, sand boxes are just a few of the new technologies being rolled out by many of the AV players. So Microsoft says, "let's give away a product and kill all that innovation". Whether or not Microsoft delivers a good product or not, all of our security will suffer.
To counter some press articles, Morro is not cloud-based. It simply sends detection statistics back to MS over the Internet (encrypted over SSL so you can't see what is being sent).
Also there's nothing innovative about Morro. It requires big signature updates and doesn't use cloud-scanning. Just the same old traditional and basic AV.
What's your take on MS Morro?