[Gil-Galad]

Most of the evil creatures that you find in LOTR were created by Melkor, more as a mockery to what was created by Eru. for example, the orcs were created out of a mockery of the elves, the trolls were created as a mockery of the ents. Melkor created many other creatures, including vampires, werewolfs, balrog, dragons and many more to do his bidding and bring evil. he possibly created the Watcher but had no use for it seeing how the oceans would easily overcome him, so he probably cast it off and worked on his next creation.