The watch can act as a remote control for your phone, but calls themselves are made through the phone. For the watch to be useful, you need a Bluetooth wireless headset linked to the phone.
When calls come in, you can reject the call, with or without a canned text reply. If you have a Sony phone, you can answer calls from the watch as well. With any phone running at least Android 4.0, you can initiate calls from the watch using its dialpad or your Android contacts list. But again, the calls go through your phone. You can control volume, but it took me a while to figure out how.
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