City-Wide Free Wi-Fi & The Business Model To Sustain It

It looks like providing free wi-fi city-wide is the new 'cool' thing to do. I began finding out how it all works and if any government can sustain it without paying for the wi-fi from its own pockets. I read that the free wifi is supported by advertisements; but I couldn't really figure out how and where will the advertisements be served.

Does anyone here know how it all works? Can the governments offer it on no profit or for profit basis?