I don't know. It seems reasonable to at least provide the options. It sort of like paying to get rid of Ads on the apps, except it's privacy, much more controversial. I bet there are people think privacy is non-negotiable, labeling it with a price somehow stains it. Unfortunately, the real world just does work like that way.
We've been down that type of road before, and it always ends with the "option" being made into a "Hobson's choice"[1] due to the inherent power imbalance. This kind of free-market solution only works when people can and do freely choose between options. With an ISP, most people will be stuck with "whatever the local ISP offers" or not having internet.
This is why there are various rights[2] that we have created laws saying you cannot negotiate them away. Without these restrictions we got things like indentured servitude. Unfortunately, the law hasn't yet kept up with the changes in technology.
Regulation. Specifically, as I somewhat implied, business doesn't get to ask people to give up privacy, for similar reasons to why you can't ask people to sign contracts that give up various other important rights. Any alternative to this needs to bring along liability for anything that happens to someone's important privacy rights.
For ISPs, we already have a model that we should be using: common carrier. It may need adaption to the realities of ISPs, but the basic idea that you get certain immunities if you only provide transit.
Dan Geer was talking about network neutrality, but I believe his solution should apply to privacy as well when he explained[1]:
Channeling for Doctor Seuss, if I ran the zoo I'd call up the ISPs
and say this:
Hello, Uncle Sam here.
You can charge whatever you like based on the contents of what
you are carrying, but you are responsible for that content if it
is hurtful; inspecting brings with it a responsibility for what
you learn.
-or-
You can enjoy common carrier protections at all times, but you
can neither inspect nor act on the contents of what you are
carrying and can only charge for carriage itself. Bits are bits.
Choose wisely. No refunds or exchanges at this window.
In other words, ISPs get the one or the other; they do not get both.
