Staring at the glowing screen of a smartphone during a live comedy show is usually considered just plain rude. Not at WiFi Wars. Steve McNeil and Rob Sedgebeer's live, interactive comedy video-gaming show not only encourages punters to whip out their mobiles, using them is integral to the show. Heck, it's the whole show.

'By describing it you sort of suck the fun out of it,' admits McNeil, co-creator of the show and half of sketch double-act McNeil & Pamphilon. 'Basically, it's a big game that we all play together. We get you to connect to our WiFi network, go to a web address, and then Rob starts beaming games into your phone.' But McNeil's keen to stress that the show isn't just for hardcore gamers. 'Don't think of it as video games,' he explains. 'It's just games. The show is 400 people sharing the fun in a room together.'

It might sound clichéd, but 'fun' is the most apt word for it. One minute the audience plays a giant version of Whack-a-Mole, the next they fly spaceships and (attempt to) avoid asteroids, and after that punters vote on which direction to take a penalty kick … The games range from 8-bit classics to 3D first-person shooters, and they're all mightily impressive. Remember the pure enjoyment of playing video games as a kid? Here, it's recreated on a massive scale.

McNeil hosts the show, while Rob Sedgebeer is the man behind the tech and makes sure all the kit's working. 'Someone described me as being "a hype man for a nerd",' laughs McNeil, 'I'm a ringmaster for a tech circus.' Sedgebeer is continually improving the games and inventing new ones. The latest, says McNeil, involves turning each punter's phone into a virtual reality headset using Google Cardboard. 'Rob's made a flight simulator, so you can fly through a city and score points,' he beams. 'You turn up, you don't have to install anything, you don't have to buy any kit, and you've got your own virtual reality thing in your pocket! Rob really is a fucking genius. I tease him about it on stage, but he actually is. I'm very lucky I met him.'

The two gaming fans met after one of McNeil's shows in Edinburgh with Sam Pamphilon. The double-act had started a more simplistic, chaotic version of WiFi Wars called Go 8 Bit, where comedians battled each other at retro video games. 'Rob came up to us and said, "I've invented this thing you might like to use in your show",' says McNeil. That 'thing' was an interactive version of one of the earliest arcade games, Pong, which involved each audience member voting as to whether their team's bat should move up or down to return the ball. The game became a regular in the Go 8 Bit shows, so Sedgebeer introduced them to another game he'd invented for the Oculus Rift virtual reality headset. Then the Royal Institution got wind of these tech inventions and things got serious.

'WiFi Wars happened totally by accident,' says McNeil. 'The RI said, "Can you come and do that as part of the Christmas Lectures?" And, as two nerdy guys, Rob and I said, "Yes!" At the time, we only had about five minutes worth of stuff but we had to do an hour-long lecture. So WiFi Wars only exists because Rob retrospectively had to invent a thing that we told them we'd already invented so we could do the Christmas Lectures.'

All that hard work has paid off, though. The show now tours the country, and is back at the Edinburgh Fringe for four nights. McNeil and Sedgebeer have a quarterly residency at the Royal Institution where they test their new games ('They really like the fact that they get new people through the door,' says McNeil, 'And we like the fact that we get to use Michael Faraday's desk!')

The pair are also in talks about adapting the show for broadcast. If that happens, it'll be the second TV show for McNeil. Go 8 Bit has a series on Dave later this year, hosted by Dara O Briain, and with lots of Sedgebeer's technology on show.

The real triumph of WiFi Wars, though, is that it quashes some of the negativity and stigma around the way smartphones and tablets impact on our lives; that they're isolating and create disconnect. 'People do stare at their phones instead of each other, that does happen,' admits McNeil. 'But we've found a way to make playing games on your phone the exact opposite of what people say it is. It's not alienating or distancing, it's 400 people sharing and enjoying a thing using a device that they've got in their pocket. We're all doing it together and it's a lovely, communal experience.'

WiFi Wars, Pleasance Dome, 12 & 13, 19 & 20 Aug, 11.20pm, £12.50 (£10).