As China's Internet giants rewrite the rules of the game for the traditional film industry, a new big player backed by the world's largest game company recently tapped into the booming market.

Tencent Pictures, a subsidiary of Tencent Holdings, announced its founding on Sept 17. It aims to challenge the Hollywood blockbusters.

One of the highlights is the upcoming fantasy film Warcraft, which is adapted from the online video game. It's scheduled for release in 2016.

Cheng Wu, CEO of Tencent Pictures, said the company will cooperate with Legendary Pictures, a US film studio, to coproduce the epic adventure title.

Legendary, which is based in Burbank, California, is behind a series of fantasy blockbusters, including Godzilla and Seventh Son.

Tencent will make use of its strength in big-data collection and customer-oriented systems to tailor the marketing and distribution for Warcraft's warm-up in China, Cheng said.

Peter Loehr, CEO of Legendary East, said: "China's significance is rising among global filmmakers. We are glad to have the opportunity to cooperate with a company as influential as Tencent."

Alongside the big movies from the United States, Tencent Pictures is talking about its strategic cooperation with novelist turned-filmmaker Guo Jingming, one of the country's wealthiest authors and the director of the highest grossing franchise Tiny Times.

The four-installment coming-of-age series has brought in a record haul of 1.8 billion yuan ($280 million).

Guo will cooperate with Tencent Pictures to produce his upcoming film adaptation of the fantasy novel Legend of Ravaging Dynasties.

"In contrast to Hollywood's mature chains, China's entertainment industry lacks a complete system to develop a brand program, which should cover a wide range from TV series and movies to computer games and smartphone games," Guo said.

He expressed disappointment in some shortsighted investments－for example, adapting a TV drama series to the big screen only after it became a sensational hit.

He insists that a valued project should be developed in every aspect from the beginning.

Attracted by Tencent's huge customer base, Guo said he expects the company's large online plat form will provide a big boost to his movies.

Under the film arm of Tencent Holdings, three sub-studios have been founded to independently develop their own programs.

Chen Yingjie, chief of one studio, said interactive communication with online fans will be an important element in program development.

He gave the example of Destiny Changer, an upcoming series based on the namesake best-selling novel.

Nearly two-thirds of the unfinished novel is still being written and updated on a website. The first season of the series, based on the finished chapters, will be released at the same time.

"We'll keep a close eye on feedback. The story lines and characters can be revised by requests from fans," Chen said.

"In the past, directors and script writers have the final say in a production, but now that right belongs to the audiences."

The second-quarter report from Tencent showed that its social and messaging platform WeChat boasts 600 million registered customers, up 37 percent from the 550 million accumulated as of the previous quarter.

For the world's second-largest movie market, which had nearly 650 million Internet surfers at the close of 2014, it means a dominant percentage of Chinese netizens are using an app developed by Tencent.

"Tencent canuse WeChat to promote any movie it wants to, and also shelve those it's unwilling to highlight," said a joking review from Cui Yongyuan, a TV host and cultural critic.

The remark made ripples during a forum at this year's Shanghai International Film Festival.

Some traditional movie tycoons take their worries further and show them earlier.

During last year's Shanghai festival, Yu Dong, CEO of Bona Film Group, predicted that in the future all the traditional movie giants will be affiliated with Internet behemoths, led by Baidu, Alibaba and Tencent.

"The only part they are unfamiliar with is how to produce a good movie. That requires unique creativity," Yu said during the 2015 Shanghai festival.

Many insiders say that Tencent's move to recruit veteran filmmakers-starting with all three studio chiefs in the movie circle－could revolutionize the industry.