These type of services usually end badly. I am not sure there is a valid profit model in this or not, but from a consumer side you leave yourself completely vulnerable by not having control of your domain and then putting in promotion effort into a project.
I seem to recall picking up some drops from a similar service that used to operate and then ran off. I sold some domains back to some extremely irate former customers.
The hosting service will probably be lousy since every spammer will sign up to abuse the system etc. etc.
If you aren't serious enough to spend a few measly dollars to have a web site, I guess you get what you deserve.