CES-UPDATE 2-LG unveils TVs, deals; vows to keep spending

(Adds details on HDTV launches)

By Franklin Paul and Gabriel Madway

LAS VEGAS, Jan 7 (Reuters) - LG Electronics Inc (066570.KS) plans to keep spending to develop new products despite a "tough" 2009, unveiling a partnership with Youtube and a dozen new TVs in the midst of the severe economic downturn.

The South Korean tech giant, which competes with Samsung Electronics (005930.KS) and Sony Corp (6758.T), introduced a dozen high-definition TVs at the Consumer Electronics Show in Las Vegas on Wednesday, in sizes ranging from 19- to 60-inches. That was a departure from past practice when TV makers competed to see which could make the largest screen.

LG also announced a partnership with Google Inc's (GOOG.O) video-sharing website YouTube to allow users to stream millions of Web videos to an LG Blu-ray player for viewing on TVs, bypassing personal computers.

LG, trying to ride out the slump while sustaining product innovation to prepare itself for when the global electronics market recovers, conceded it faced a difficult year.

"Year 2009 will be challenging in many ways," Michael Ahn, chief executive of LG Electronics USA, said in an address at CES. "We will not reduce marketing spending or research and development investment."

LG warned in December of slowing cellphone sales growth. Like rival makers of televisions, mobile phones and other devices, LG faces tough questions about how to navigate through the global economic downturn, weighing shifts in spending plans and innovation as well as the need to balance market-share safeguards with profit margins.

The South Korean firm has in recent years focused on growing its share of the U.S. market. At CES, LG said it marked record growth in 2008 in mobile phone shipments and revenue.

LG touched off a minor sensation with its touch-screen GD910, which it called the world's smallest 3G-enabled watch phone. The James Bond-like gadget came with a feature that allows video telephony.

"We will maintain and improve LG as a premium brand through product leadership," Ahn added.

Some of LG's new high-definition televisions, on view at CES, are aimed at customers of movie-rental chain Netflix (NFLX.O) who want the convenience of Internet-to-TV movies without the clutter of an additional, external box. [ID:nN04339325]

The Korean firm also announced multimedia-sharing deals with Yahoo (YHOO.O).

Two networked HD TVs -- boasting "netcast entertainment access" and a Widget-based interface -- are designed to capitalize on an alliance with Yahoo. The TVs also feature movie and video streaming, photo sharing services. (Additional reporting by Kiyoshi Takenaka; Editing by Edwin Chan, Leslie Gevirtz)