Surround sounds via ear phones

I  recently saw that on a Samsung Galaxy Y, that users have an option to switch between normal speakers mode or to 5.1 speakers. This is possible as even there are 10 different speakers, everything is heard from our two ears. So if we can simulate the sound effect generated from those speakers, we can add as many as speakers and the head phones will simulate it. No need to get the physical speakers, all you need is the simulation. My idea is to develop an application (as a start an android) that enable user to configure the speaker position and the volume. Our software will simulate the effect through the ear phone. Simple and yet interactive application. We are working on to make it compatible with the standard media player or to be used with any other media player.
Currently we are developing this application and Lets see how far it will go.