AVG, makers of the AVG Free anti-virus software, today warned Microsoft of the problems it faces with its free anti-malware software - codenamed Morro - due for launch next year.

AVG predicted Microsoft would incur "enormous overhead costs" for customer service and support issues, as well as for ongoing product management and upgrades.

The company's CEO J.R. Smith said: ""Microsoft is clearly following our lead, which will certainly help combat basic and less sophisticated threats. But the real threat in this scenario is to Microsoft's own profitability and channel partner relations."

Morro never dies?

Morro will replace the Windows Live OneCare package currently sold on a subscription basis, and will be available as a standalone, free download next summer.

AVG envisages a backlash from partners used to selling lucrative Microsoft products, and questions the Redmond company's ability to respond to fast-moving malware attacks.

AVG noted that Microsoft often relies on its monthly 'patch Tuesday' updates to refresh its current anti-virus product, which it says "leaves computer users vulnerable to botnets and other malicious attacks."

All good points, but you have to wonder about how threatened AVG itself - with 85 million users of its AVG Free antivirus software - feels by the prospect of free anti-malware from the world's dominant software provider.