You can either talk into the watch and listen to it by holding it up to your ear, or by using a Bluetooth headset. A bar on the bottom of the watch casing is used to interact with the watch phone. The bar actually has three buttons. The user interface relates smartly to these three buttons and typing a phone number looks efficient.
The phone supports SMS text messaging - though entering text messages (and, for that matter, phone numbers) can be a little awkward as you have to scroll through the alphabet or the list of digits using the scroll bar. Presumably voice commands would help in a retail product, much as it does on Nokia's keypadless 7380 phone.