I think they are a great tool. But as with any other tool, their effectiveness comes down to the skill of the hands using the tool.
In terms of a training collar to allow for corrections, they are the best choice. Far better than the traditional choke collar. They allow the handler to really customize the correction level, and a prong can be used to give both softer and harsher corrections as needed. Something that is far more difficult to do with a choker. Less take up before the correction happens, as compared to a choker, translates to better corrections in terms of timing and now allowing the dog to anticipate the correction. And they are less prone to causing injury as compared to a choke or head halter.
At the same time, I feel too many people use prongs (and every other collar/head halter/harness on the market) as a crutch to control the dog, rather than actually *training* the dog.
They are a useful tool for training, certainly. Likewise, using a temporary crutch to make things easier for the owner to do the training can often be a good idea. But no tool should be a long term means of control, and in the end it should be the training and relationship that influences the dog's behavior, not the collar he is wearing.
2 important things when using a prong.
First, as Tracy said, make sure it is fitted properly and sits high on the neck. I see far too many pinch collars fitted too loosely.
Second, as with any training device, condition the dog to the prong before using it. That means getting the dog used to wearing it by putting it on the dog for several walks, play sessions, etc... without actually using it. This prevents him from becoming collar wise (knowing he has to behave when he's wearing the collar because you can correct him.. and he doesn't have to behave when he's not wearing it because you can't correct him). And it builds a positive association with the collar so the dog thinks of it as a fun thing that means he's going to get to go for a walk or play, and will associate any corrections he gets as coming from you and not being related to the collar itself.