When you logon to your ISP, usually through PPPOE, you are assigned ISP's name server a.k.a DNS server through DHCP.
Your ISP's name server is ok but not fast enough. :no: By fast we mean the time take to reply to queries like who is "yahoo.com", the answer usually is the ip address. This is more complicated then this, but thats a different thing.
Open DNS on the other hand promises to be fast, block ads and other such stuff. You avoid using ISP's DNS and use Open DNS instead.
There revenue is through ads just like google and hence its free for you.