@Mozilla / Firefox / Adblock
It's not really about adverts, they are on the sites already and can be blocked. Phorm probably not planning to alter existing ads, simply modify their own ads having got a website to place them.
The real problem is their monitoring your datastream. They can sell on marketing data derrived from that regardless of weather you have opted out of ads. With their servers in that position they could do a lot more than they are currently talking about. Ofcourse ISP's are also in that trusted position, but instead of taking the risk directly they have let a 3rd party do it without altering the ISPs original function.
There have been many calls for censorship of the Internet as well as monitoring. You may not be able to get foreign sites to take stuff down fast enough for your liking but you can cirtainly control your domestic ISP. You can't not have a domestic ISP unless you use satellite. But then it would be very very easy to feed Interferance into a satellite from an earth station.
People might say use an encrypted or Tor service but then that's going to be easy to block and outlaw.
The Internet probably has about 2 years left before it becomes something else But at the rate things are going, so will everyting else.