1&1 Internet, is currently offering up to 25 free .biz domains for 1 year. With a .biz domain, you receive free private domain registration, an email address with 2GB storage, email forwarding and auto-responder, and 24/7 toll free phone/email support. There is no coupon required.

I don't see anything indicating hidden fees or catches.
The fine print states that the discount is valid for the first year only -- after the first year, standard pricing and a 12 month minimum registration period apply and that the offer is valid through October 31, 2008. However there doesn't appear any requirement of signing up for anything longer than 1 year. The only thing of note is that you will still have to enter your credit card information during the checkout process even though this is a free offer.

Here is the direct link:
order.1and1.com/xml/order/Instant;jsessionid=2934E667097B2E342771CF2C60405726.TC61a?ac=OM.US.US499K14702T7073a

It limits 1 per user. It doesn't look like there is a catch, they just assume you will continue to use them after a year.

I'd stay FAR away from 1and1... I would not even do business with them for something free... bunch of crooks. I'd not be mad if they went out of business.

it is true?

Please note: To provide you a higher level of security, it is 1&1's policy to verify each credit card provided. 1&1 will make a $6.00 authorization-only charge, which is then immediately reversed by your financial institution, to ensure the functionality of the credit card in our billing system. This transaction may show up on your credit card invoice. If you have any further questions, please contact our billing department at billing@1and1.com.

I don't recommend using 1&1 for domains and even hosting. The sales guys are very rude. But as you see, the .biz is only free for 1 yr. Then it becomes $6.99. I really don't think it's worth it.

All the best,