Most free webhosting providers that close after 6 months - 1 year do so for financial reasons.
I divide the free webhosting industry into the following categories:
1) Everything for nothing.
No advertisements, no forum participation, no limits, and no business model.
These hosts are the most popular among users, but have the shortest lifespan. Most close within 3 - 6 months with some lasting 6 - 12 months.
I've taken over several of these before, but the users are mostly leeches that won't even accept advertisements or basic community participation.
2) Mass market.
Basic control panel, limited space, no domain name support, no scripting, forced advertisements, and a paid upgrade path.
Angelfire, geocities, and many others fall into this category.
3) Boutique/niche
Every feature of a paid webhosting provider at no cost with a catch.
These providers often require community participation (forum posting) or some other method to provide quality control while offering almost identical accounts to paid webhosting providers. They can die after 6 - 12 months or live on for years as profitable services.
4) Wolf in sheep's clothing
Free webhosting as a hook for paid upgrades.
These providers exist solely as an upgrade path to paid webhosting accounts. Many close down their free webhosting offerings after 6 - 12 months and cancel any free webhosting accounts that aren't upgraded to paid accounts.