I think the population at large generally needs to get over their hangups (actually, maybe they have, and it's just techies). No one in a first world country cares if you visit pornhub just like no one cares if you go to amazon. Your ISP has had the ability to see this since the beginning of the web. It does not matter, but we can also have privacy laws restricting their (and everyone else like application/service vendors) ability to record and share that information. If you really want, you can hide it with a VPN or Tor. As long as not everything is opaque, it's easy to block that traffic if you'd like (so e.g. kids can't use it). In a first world country, this works fine since actually no one cares if you're hiding something, so you don't need to blend in. At a societal level, opaque traffic is allowed.

You could have cooperation from everyone to hook into some system (California's solution), which I expect will be a cover for more "we need to block unverified software", or you could allow basic centralized filtering as we've had, and ideally compel commercial OS vendors to make it easy to root and MitM their devices for more effective security.