PHost implements one model of a wraparound universe. In a wraparound universe, ships that fly off the "edge" of the map appear on the other side of the universe. Thus, the universe behaves more like a sphere (or a torus) than a plane. For example, in the original VGA Planets map, you can fly from (1010,2000) due west (heading of 270) and after 20 LY of travel you will appear on the other side, at (2990,2000), where you will continue on your journey flying due west.
A wraparound universe allows players to make more use of all areas on the game map. Depending upon placement of homeworlds, there need not be any more "dead" areas that take a long time to reach and may never even be explored. A wraparound universe also gives each player more neighbors, thus leading to greater interaction between players. Races on opposite sides of the universe that used to be distant unknowns can now be neighbors.