It's been known for quite some time now that Microsoft has been working on a free antivirus application and it appears that the company will soon have a beta version of the app available.
Codenamed Morro, Microsoft first revealed their plans for the free antivirus service in November 2008. Morro is essentially a stripped down version of Microsoft's Live OneCare service that failed miserably when it launched and Micrsoft says that Live OneCare will be phased out, perhaps once Morro is finished up.
Microsoft has previously stated that they would be launching Morro in the second half of this year. Even though we have yet to see the beta for this, it wouldn't be surprising at all to see the launch of Morro coincide with that of Windows 7, as it would be a great time to make one big switch to everything new.