A man walks through a shopping precinct. Tiny cameras capture his every move. If he so much as turns his head to glimpse into a shop window, that action is recorded, next to a reference number that identifies him uniquely among the many shoppers around him. As he walks through the crowded mall, the advertising billboards subtly change to suit his profile, flashing aeroplanes and knitted sweaters to replace the beach towels and lipstick intended for the woman in front of him. He ducks out of the precinct, looks around him, then walks down a side street to the door of a VD clinic. But the cameras are still watching him. Silently, passively. But watching him all the same ...

This is not a novel by Philip K Dick: it is happening right now. The only difference is that it's not happening in the physical world, it's happening online. Since last autumn, BT – under the "Webwise" banner – has been trialling a technology called Phorm, which dials direct into your internet service provider's network and intercepts communications between you and the websites you visit, using information about the sorts of things you are viewing to serve you targeted ads.

From shopping and watching TV to keeping in touch with friends, seeking advice about our health and finances and even meeting prospective partners, what we do over our internet connections now reveals more about us than any other single activity we engage in. But despite this, the world wide web is most commonly seen as media. And with media comes advertising. We tolerate the advertorials, double-page spreads and ever longer ad breaks because we understand that this activity funds the production of our newspapers and favourite TV shows. But should we tolerate Phorm?

Thanks to hard work from campaigners at the Foundation for Information Policy Research and the Open Rights Group, and activists at dephormation.org.uk and nodpi.org, we now have that choice. The Information Commissioner's Office has ruled that BT must ask the explicit permission of its customers to "opt in" before enrolling them into its Webwise trial (rather than the pernicious "opt out" clauses so beloved of marketers and junk mail operatives). Here's why I think every last one of those customers should actively count themselves out.

Internet Service Providers (ISPs) are not media companies. They do not get to decide, or even influence, what we watch, who we talk to or what we buy online. If they did, the world wide web would never have got off the ground. We would not have eBay, Amazon or Google, because back when these publicly listed companies were just glimmers in the eyes of their pioneering founders, ISPs would have put up barriers against entry to "their" market, charged punitive rent for access to "their" cables and "their" (our) eyeballs at the end of them. For the world wide web to work, ISPs must be neutral about the content that flows across their wires. That principle of neutrality extends to Phorm – if ISPs start intercepting the communications between us and the websites we visit online, spying on our activity to give themselves an unbeatable advantage in the ad sales market, the media companies that rely on selling ads to survive will suffer irreparable damage.

Instead, ISPs must continue to be viewed as providing infrastructure, and infrastructure of a very special kind. Like the MP, the journalist, the doctor and the priest, ISPs have the power to know the intimate details of our lives. They should be prevented from abusing that power, and shielded from the power of those (like the Home Office, with its widely reported plans to "modernise" the state's interception capability) who would seek to force them to break their confidence with us. If this does not happen, it is not only the digital economy that will suffer, it is modern liberty itself.

The Convention on Modern Liberty will begin in London on Saturday 28 February at 9.45am at the Institute of Education, 20 Bedford Way London WC1. Other sessions, with live screenings from London, will take place at Trinity Centre, Trinity Rd, Bristol; Student Council Chamber, Oxford Road, Manchester University; Cambridge Union, Bridge Street, Cambridge; Institute of Advanced Studies, University of Strathclyde, Montrose Street, Glasgow; Peter Froggatt Centre, Queen's University, Belfast.The venue in Cardiff is yet to be confirmed.

For information and to buy tickets at £35 (concession £20), please visit: modernliberty.net