Startup Brave has begun showing ads in its web browser with privacy-focused new technology. Later this year, other software makers could start doing the same.

The company plans to release a software developer kit as soon as the second half of 2019 that will let other programmers tap into its privacy-protecting ads, Chief Executive Brendan Eich told CNET in an exclusive interview.

"First we have to prove the model in Brave," Eich said. But after that, he said, "we do want better scale, for high-quality ads with a better audience." Many details aren't settled, but Brave will extract some of the resulting revenue, he said.

The spread of Brave ads could be important, both for Brave's financial success and also for online privacy more broadly. Ads appear all over the internet, but getting people to switch from Google's dominant Chrome to other browsers can be tough. Broader use of Brave ads could mean more of us benefit from ad-supported services without paying with our own loss of privacy.

Brave is trying to rebuild the internet's advertising technology so we can use free, ad-supported websites without worrying that publishers and advertisers are harvesting our personal information. Its technology can personalize ads, an approach used for years to make ads more relevant to us and more lucrative to publishers. But unlike conventional ad technology, Brave's approach does all the targeting within its own software to maintain your privacy.

It won't be easy for Brave to dent the massive digital ad marketplace. Advertisers are expected to spend $132.3 billion on US digital ads alone this year, according to tracking firm eMarketer. Brave has a respectable 5.5 million monthly users, but that's a tiny fraction of the billion-plus who use Chrome.

External forces could help accelerate changes. Europe's General Data Protection Regulation, a thorny law for companies like Google that want to keep tabs on our online behavior, isn't a problem with Brave's approach. And the GDPR is becoming an international standard, Brave told the US Federal Trade Commission in a filing this week.

"In the coming years, the application of GDPR-like laws for commercial use of consumers' personal data in the EU, Britain, Japan, India, Brazil, South Korea, Malaysia, Argentina and China bring more than half of global GDP under a common standard," said Johnny Ryan, Brave's chief policy officer, in the letter.

Brave's two-phase ad plan

The plan for Brave's ad technology -- disabled unless you activate it -- has two phases. The first shows ads in a notification you can click. Just seeing the notification generates some revenue, but clicking on it generates more. You keep 70 percent of that ad revenue and Brave keeps 30 percent. This is the form of advertising now build into the test version of Brave geared for developers but that will spread more broadly.

The second phase will build Brave ads directly into publishers' websites in partnership with those publishers. There, the publisher keeps 70 percent while you and Brave each get 15 percent. This phase should arrive later this year, Brave said.

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Brave, proceeding gradually, still hasn't begun paying anyone for the ads. That'll happen in the coming weeks, the company said. When it does, you'll be paid in with the cryptocurrency-like technology called the basic attention token, or BAT.

Eventually you'll be able convert those into ordinary money, the company said. But by default Brave shares them back with website publishers, YouTubers and Twitch video game streamers as a way to fund their operations -- and by the way to offset revenue lost when Brave blocks their ordinary ads.

The SDK will mean others can tap into the tech, too. If you were using an app with BAT-powered ads, you'd keep 70 percent. The app and Brave would split the remaining 30 percent, but details aren't yet settled, Brave said.

At least some of the SDK-derived revenue will fund Brave's work to operate the BAT system, for example by countering fraud and other schemes, Eich said. "Security is never done. There has has to be a cost to that," he said.

New apps, same privacy

Even though others will use the ads, Brave's privacy principles will carry over, Eich said.

A trade group, perhaps something akin to Digital Content Next, likely will govern the use of BAT-powered ads beyond Brave, he said.

One example of what it would oversee is ensuring there isn't abuse of the system. Sensors that the SDK needs to ensure it's showing ads to real humans, not bots, shouldn't be sending private data to servers, he said.

One benefit of the SDK is that broader usage should help Brave's BAT crypto-token foundation, something Brave detailed at the end of its basic attention token white paper. The basic idea is that BAT usage for ad-related transactions will increase compared to speculators trying to just buy and sell BAT as a currency for profit.

"As we get more transactions on the platform, that will dominate the pricing and help stabilize the price," Eich said.

First published Jan. 25, 5 a.m. PT.

Update, 9:34 a.m. PT: Clarifies that the SDK could be released in the second half of 2019 but possibly later.

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