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"They'd say things like, 'That woman sitting at the back is giving me funny looks whenever I talk about a certain subject', when no such thing was happening."

And for our next trick...

The next stage for the CAVE is the ability to fool the other senses. Spatial audio is already being used to realistically simulate voices and sound effects within the virtual environment and, although experiments aimed at adding smells have met with varying degrees of success, they're continuing regardless. Clearly, however, the greatest challenge is allowing people to touch things in the CAVE, which is where haptics - the study of touch - comes in. Computer games already benefit from early haptic devices, such as force-feedback steering wheels, but these simple "rumble" devices are just the tip of the iceberg: scientists are currently working on gloves capable of mimicking weight and resistance.It's a technology Waterfield admits to being excited about.

"I've just done a little assignment on what Land Rover might require from haptics in the future," he explains. "There are devices out there, but they're very large. We'll start on touch feedback, which is quite easy: you just need something on the end of the finger. At the moment, we have the ability to change the colour of the image so you know when you're touching it, but there's no feeling."

Waterfield doesn't plan to stop at the hands when it comes to physical feedback. "We'll have cyber-gloves in the UK to track motion, but it's very limited. If you're talking

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about getting in and out of the vehicle and simulating the clash of your backside against the outline of the car, that would take an awful lot of technology. You'd need some sort of body suit that would stimulate the nerves. I think it's possible, but you're talking 20 years in the future."

By that time, virtual reality could well have become an everyday occurrence in our lives. At the end of January, Sony celebrated the launch of its new movie, The Water Horse: Legend of the Deep, by causing a 15m-high sea snake to burst out of Tokyo Bay. Elsewhere, Prince Charles recently made a holographic appearance in Dubai. While both were actually just 2D recordings giving the appearance of 3D, they're an indication of the direction in which companies are beginning to look.

Cisco has hinted it would like to bring this sort of technology to the boardroom. Its current generation of teleconferencing software, dubbed TelePresence, attempts to remove the distance between boardrooms by making it appear as if the person you're communicating with is in the same room as you.

It does this by making every TelePresence room identical, so when the video link is achieved, those who are involved in the meeting are displayed life-sized with an identical backdrop on high-definition televisions on the other side of the desk. We've seen it in action and it works well - after a few minutes you forget that you're communicating over thousands of miles.

The evolution of this technology involves 3D holograms of the meeting participants that move and interact with each other, just as they would if they were physically in the same room.

The technology's coming into the home, too. You could barely walk ten yards at this year's Consumer Electronics Show without bumping into a demonstration of 3D television, and Steed doesn't believe it will be too long before we're seeing the CAVE, or something similar, in our living rooms.