VM using Phorn or something like it?

VM have never inserted advertising, Phorm was never deployed on the VM network.

The only thing living on the VM network is the Allot Omega Series gateway, used for traffic management.

What you are seeing is Google Adwords serving adverts based on what they have categorised you as most likely wanting.

I don't know what they are using but it is really annoying. They insert virgin media ads into pages and sometimes when you select a website link on a website ctrl+c copy and paste in to another tab it pastes as www.virginmedia.com.!?!?!. If they are not inserting stuff, I don't know how to explain that.
It took me ages trying to disable their custom website not found error service. I click to disable. It said disabled, but it kept coming up even it showed it was disabled.
Private vpn makes more and more sense....

Use an alternative DNS service - OpenDNS (who do the same thing) or Google public DNS who provide the service because they think they don't know quite enough about you yet are possibilities in that area.

Alternately you could use FireFox + Ghostery plugin to block tracking cookies.

As mentioned, this is nothing to do with Virgin.
But you can block cookie tracking on most browsers. I use thismand it works like a charm.
http://abine.com/dntdetail.php "Do Not Track Plus" And its free
(On top of this, I also block adds anyway, as they just irritate me)

In reply to a post by Luap:

As mentioned, this is nothing to do with Virgin.

Advertiser tracking cookies are certainly nothing to do with Virgin but serving up a page of adverts instead of a 404 when a url is entered incorrectly most certainly is. I imagine that some would find it useful. I'd just find it irritating so I don't use the VM DNS servers.