Just elaborating on what others have already said, but the primary function of the LTE connectivity is to connect to your phone through Samsung's servers, so that your phone can push you notifications that it receives. In principle you could leave your phone turned on and connected to wifi or LTE at home, and just go around all day with your watch. If you have a number pairing subscription like T-Mobile Digits, the watch will get all the phone calls that go to your phone. Otherwise it'll just have its own number. It'll still get your texts though, since those are notifications that get pushed to the watch (and you can even respond!).
Technically your watch can do most everything your phone can. It can get calls and texts on its own number. In theory you could even install other messaging apps like WhatsApp or Hangouts on your watch and use it to get all your messages; only problem is that Facebook and Google have not developed these apps for Tizen.
Having said all that, I find the notifications immensely useful. I usually go solo with my watch only when I'm out jogging. The simple connectivity to my phone serves its purpose quite well.