Andy Faust at WatchAware:
But the benefit to a circular display is that the entire display can rotate without any data loss — just like the inside of a compass. This means that, once calibrated with your head-level as “north” (you are a star, after all!), the UI will always know where your smartwatch is in relation to your eyeballs. And exactly as a compass always points north, your smartwatch display will always balance itself for maximal viewing, allowing for centered, left-to-right (or right-to-left) reading no matter how off-center your wrist happens to be. No more turning and twisting your head like a chump!
An interesting thought experiment from Andy, and something that could be easily incorporated into current smartwatches given their accelerometers and other movement sensors.
However, I think there's a fundamental flaw — at least for now — in round smartwatches: practically all information (other than the watch face itself) is presented in a square/rectangular format. Information — especially text, lists, card-based UIs — just doesn't sit right inside a circle. The usability of almost every feature that makes Moto 360 smart, for example, is being sacrificed in order to look great as a watch. Like the phone in smartphone, the watch in smartwatch is just one feature — and not the most important one.
If round smartwatches are to stick around (and I hope they do as some of them look like great watches and offer variety to consumers), I think there needs to be a significant rethinking of how information is presented. Currently, it does indeed feel like current round-faced smartwatches are "circling the square" as Andy says in his piece. Instead of squishing a straight-edged UI into a round space, there needs to be a new interface paradigm for the round smartwatch — and Apple isn't going to come up with it any time soon, so it's down to Google to figure it out for Android Wear.