Samsung will launch a smart watch early next month, according to the Financial Times, beating fierce rival Apple to what could become a significant growth area in the mobile market.

According to sources, the device, known as the Galaxy Gear, will be unveiled ahead of the IFA technology trade show in Berlin (6-11 September). It is believed to show messages and notifications from a tethered smartphone in a similar way to the Pebble, a rival smart watch.

Apple took the lead in defining the smartphone space with the launch of iPhone in 2007. By launching a smart watch ahead of its US rival, Samsung could potentially define the wearable computing market in a similar way — as long as customers are convinced to buy it.

Apple is believed to be working on an ‘iWatch,’ with a recent Financial Times report suggesting the company is heavily recruiting to tackle design problems with the device and that it could be at least a year before it is launched.

Previous smart watches have suffered from problems around usability, screen size and battery life — issues Samsung and Apple will be keen to overcome.

Analyst group Canalys recently forecast that five million smart watches will be shipped in 2014, driven by a new generation of devices from the likes of Apple, Google, Microsoft and Samsung.

Canalys estimates that around 500,000 smart watches will be shipped in 2013, with Sony and Pebble leading the way.

In May, Sundar Pichai, Google’s senior vice president for Android, Chrome and Google Apps, said Google is focusing on preparing Android for the next five to 10 years of computing to ensure a common user experience across devices, including intelligent watches.

Sony had its latest crack at the smart watch market when it unveiled its SmartWatch 2 at the GSMA’s Mobile Asia Expo in June.

The device was described as a “second screen for your Android smartphone”, serving as a “multi-functional watch, notifier, Android app interface and phone remote control all-in-one”. Due to be launched in the third quarter, the SmartWatch 2 also includes NFC for one-touch pairing with devices.

The Pebble watch, which launched in January, reached one million app downloads in July, with thousands of different apps available. The company said in a blog post that it wants to create “the world’s best smartwatch and ecosystem” by driving third-party app development.