Freebie: Google URL Shortener
Terms of use : Refer to Google Policy http://www.google.com/accounts/TOS
Website:
http://goo.gl/
Site feature: 301 permanent redirect short URL to long URL, additional feature including tracking on referrers browser, countries, and visitors. The page also ready with QR code, easier for mobile user to visit the URL.
Screenshots:
Example:
Short URL - http://goo.gl/IuTAS
Long URL - http://www.bubblecreative.com.my/