Illustration: Aïda Amer/Axios

The U.S. government plans to probe TikTok over national security concerns, sources tell CNBC.

Why it matters: The viral video-sharing app owned by Chinese tech giant ByteDance has cause concern for U.S. policymakers in recent months. As its reach grows within the U.S. — particularly among children — there's anxiety as to whether the app collects and shares data from American users with the Chinese state.

Details: The Committee on Foreign Investment in the United States (CFIUS) is reportedly reviewing ByteDance's year-old acquisition of U.S. karaoke app Musical.ly.

  • According to CNBC, ByteDance is in talks with CFIUS over divesting parts of Musical.ly.
  • A TikTok spokesperson told Axios: "While we cannot comment on ongoing regulatory processes, TikTok has made clear that we have no higher priority than earning the trust of users and regulators in the U.S."
  • "Part of that effort includes working with Congress, and we are committed to doing so."

The big picture: The news comes amid a slew of policymaker investigation requests into the app — as well as growing concern from industry leaders.

  • Last week, Sens. Chuck Schumer (D-N.Y.) and Tom Cotton (R-Ark.) asked for a national security probe into the app.
  • Last month, Sen. Marco Rubio called a CFIUS to review the acquisition of Musical.ly.

TikTok has grown to become one of the most popular apps among U.S. youngsters.

  • According to a new Morning Consult survey, the app is more popular today among U.S. teens than Facebook.
  • The app hit 1 billion downloads in February. It reportedly has more than 100 million U.S. downloads.

Be smart: There's a precedent that's been set, somewhat, in this situation. Earlier this year, the owner of Grindr, a U.S. LGTBQ dating app, was reportedly forced by CFIUS to sell service over U.S. national security concerns.

Industry rivals have pointed to TikTok as an example of unprecedented competition and the threat it poses to U.S. leadership in the tech sector.

  • Last week, Adam Mosseri, head of Instagram, said at a company news event that TikTok’s ability to clone a U.S. competitor and then grow it big enough to acquire that competitor was "some serious s--t."

Between the lines: The news comes amid reports that ByteDance is looking to go public, potentially in the U.S. market. Regulatory concerns could greatly impact its ability to launch a campaign to go public in the U.S.

Yes, but: ByteDance’s accession has come with an increase in regulatory firepower.

  • The company, reportedly valued at $75 billion, has increased its lobbying prowess in the U.S., bringing on outside experts and even a former member of Congress to help with its lobbying efforts and with crafting its content moderation policies.

A source tells Axios that Grindr was "a key case as to how social media would be handled under CFIUS, but people overlooked it because it was an LGBT app."

Bottom line: This is bad news for ByteDance if it wants to continue to grow its presence in the U.S. The U.S. is by far the most lucrative advertising market and at a key stage for expansion for any foreign-owned app that wants to grow its bottom line. 

Go deeper:

Go deeper

Trump, Biden strategies revealed in final ad push

Data: Bully Pulpit Interactive; Chart: Danielle Alberti/Axios

President Trump is pouring hundreds of thousands of dollars into Facebook ads on the Supreme Court and conservative judges in the final stretch of his campaign, while Joe Biden is spending over a million on voter mobilization, according to an analysis by Axios using data from Bully Pulpit Interactive.

The big picture: Trump's Facebook ad messaging has fluctuated dramatically in conjunction with the news cycle throughout his campaign, while Biden's messaging has been much more consistent, focusing primarily on health care and the economy.

How NASA and the Space Force might fare under Biden

Illustration: Eniola Odetunde/Axios

Joe Biden hasn't gone out of his way to talk about outer space during his presidential campaign. That could be bad news for NASA's exploration ambitions, but good news for the Space Force.

The big picture: NASA faces two threats with any new administration: policy whiplash and budget cuts. In a potential Biden administration, the space agency could get to stay the course on the policy front, while competing with other priorities on the spending side.

56 mins ago - Health

Axios-Ipsos poll: Federal response has only gotten worse

Data: Axios/Ipsos poll; Note ±3.3% margin of error for the total sample size; Chart: Andrew Witherspoon/Axios

Americans believe the federal government's handling of the pandemic has gotten significantly worse over time, according to the latest installment of the Axios/Ipsos Coronavirus Index.

Why it matters: Every other institution measured in Week 29 of our national poll — from state and local governments to people's own employers and area businesses — won positive marks for improving their responses since those panicked early days in March and April.