"We believe what Second Life did was great, but it's time for 'virtual worlds 2.0' . . . unlimited, open, scalable worlds." Outback Online uses P2P networks of PCs, not central servers. A P2P-powered virtual world draws on the network power of all participants - and could handle 100 times the visitors of the central server model, Yoick claims.

National ICT Australia (NICTA) developed the online game technology over three years to test scalable and economical applications. Mr Leeb-du Toit, NICTA's business development director, added a powerful graphics engine and spun-off Yoick. "We decided what we needed to build was not a game, but a playground," he says. "It's very much about virtual worlds, user-generated content and social networking." Yoick wants to "mash-up" the endearing qualities of successful internet ventures: the addictiveness and visual richness of World of Warcraft, the personal expression of MySpace and the mobility of internet phone service Skype.

"Outback Online is a virtual world system that will be on your computer 24/7, and we don't yet know what changes that's going to bring, but we've got an inkling that will be pretty profound," Mr Leeb-du Toit says. In the new world, an 'outback' is equivalent to Second Life's islands - a hub for users.

It's an environment in which one can talk, build and play. Yoick's Phil Morle calls it "a huge box of Lego". You can develop private outbacks for friends or a concert for 5000 visitors. The P2P architecture overcomes some obstacles that prevent such a gathering in Second Life but Mr Morle, a consultant who worked on Outback's development, says the visual quality is greatly improved. "Second Life has a low-res look to it whereas sometimes I just stand there in the rain and watch the sun go down in World of Warcraft because it is so beautiful," he says. "Our stuff is rich, 3-D and graphically more like something you'd see in World of Warcraft."

Usability was also a focus. "I want my kids to be able to design an experience in Outback," Mr Morle says. "They can't even figure out how to move in Second Life." With a release date of "sometime this year", it will take a while to determine how Outback Online handles a million users an hour. "It's hard to say there will never be problems," Mr Leeb-du Toit says. "But the advantages of P2P versus a client-server (system) are huge."

Mr Morle, the former Kazaa CTO, has assembled an expert team experienced in P2P applications that includes development director Marty Poulin, formerly online technology director at Disney's Buena Vista Games. "While I was at Kazaa it was a common conversation to dream up ways of using peer-to-peer in 3-D worlds," Mr Morle says. But a P2P system suffers from a more complex network architecture - the peer with the information you need to update your scene may be firewalled.

And overcoming the lag with data queries will be a challenge - in multi-player gaming, milliseconds matter. Outback promises fewer rules than other virtual worlds -which suffer from pedophiles (MySpace) and public sex (Second Life) - but better controls to shield children. Second Life chairman Mitch Kapor reportedly claims virtual worlds are a "hundred billion dollar opportunity". With a Skype pricing model, Mr Leeb-du Toit says Outback Online will be free for the average user.

And there is a "strong possibility" of venture capital funding. For now, they are still building the world of their dreams.