As expected, lots of /.-ers fail to make the distinction between phages and (human-infecting) viruses...
Phages have been tested as an interesting alternative to antibiotics. One disadvantage has been that they are very specific, which means that one often would have to apply many strains in order to fight an unclassified infection. On the other hand, with the advent of metagenomics, it has become clear that the composition of our commensal bacteria in the gut and on other places are critical for our health (both mental and physical) and that there may be several diseases caused by messing with this ecosystem by too frequent use of antibiotics (overlays of antibiotic usage and several diseases (heart diseases, diabetes, psychological diseases) per geographic area actually fit pretty nicely).
An interesting application of phages could be to manipulate our commensal ecosystems in such a way that we ensure a "healthy" composition in our gut, lungs etc.
Since the phages themselves are not alive, I have no idea what such a treatment would be called. It is not an antibiotic and it is not a probiotic... parabiotic? Nah... I will leave that to the marketers.