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The market has said they want big screens. They don’t even make small-sized smartphones any more. You must carry that skateboard around, like everyone else.

Apple does sell a watch with cellular and GPS and it can replace a phone (you can literally talk into it)

Samsung sells watches with standalone cellular. You can get an eSIM for the watch and leave your phone at home. Seems their Gear S from 10 years ago was the first.

https://en.wikipedia.org/wiki/Samsung_Gear_S

Why doesn't Apple sell the Apple Watch Ultra?

Battery life??

How would most things work on such a small screen?

I think the Apple Watch will become increasingly standalone.