BlackBerry maker Research in Motion (RIM) dismal quarterly earning forecast has left it with a bloody nose but it far from being dead.

RIM announced its first quarter earnings on Thursday and forecast that its revenue for the second fiscal quarter will be between $4.2 billion and $4.8 billion. It slashed its full-year EPS outlook from $7.50 to between $5 and $6.50 and said profit for the quarter will be between $0.75 and $1.05 a share. Analysts had estimated RIM's profit at $1.40 a share.

RIM also said it will take austere measures, including possible job cuts, to cut down on costs.

RIM's dismal forecast, its worst in 9 years triggered a hammering of its shares and during after hours trading its shares plunged as much as 19 percent.

RIM's biggest blow came when Jarislowsky Fraser Ltd, the company's sixth biggest investor, said it is on the way out.

Chairman Stephen Jarislowsky told Bloomberg that RIM is resting on their laurels and criticized the company's marketing strategies.

Steve Jobs is a better marketer than RIM, he said.

Jarislowsky Fraser owned 10.2 million RIM stocks at the end of first quarter but the stake has been reduced by more than 50% or even more, Jarislowsky said.

According to market watchers, RIM's BlackBerry, once the gold standard of smartphones, is now just one more option in a market flooded with iPhone and Google Android OS-powered smartphones. Lack of independent development of third party apps and failure to innovate have also triggered an exodus of casual smartphone users and gamers.

Even as the BlackBerry OS has failed to keep up with rival platforms like Android, iOS, and even Windows Phone 7, the company's PlayBook tablet turned out to be a big disappointment compared to iPad (Apple), Galaxy Tab (Samsung/Google) and even Xoom (Motorola). Last month, RIM had to recall nearly 1000 Playbook to address faulty hardware concerns.

However, RIM, which is finding it difficult keeping up with rivals Apple and Google in the smartphone industry, is far from being dead.

RBC Capital Markets Managing Director Mike Abramsky in a note to investors on Friday said it is too early to write RIM off.

Disappointing Q1 results validates prior execution concerns amidst competitive pressures, Abramsky said. Although it’s possible RIM fails to turn itself around, that outcome may be premature, we believe, given sustained positives.

Abramsky said RIM reported 16 percent year-over-year growth and its 68 million total subscribers and service growth and enterprise leadership still make it a formidable player in the smartphone industry.

RIM's strategy with QNX, TAT-built user interfaces and Android app support “remains sound,” Abramsky said and the impact of BlackBerry 7 devices this fall and then QNX-based handsets, which are expected in the first quarter of 2012, could make RIM an “attractive acquisition candidate.”

QNX OS are expected to become the core of future BlackBerry super phones that will run on multi-core processors and will be NFC compatible.

Moreover, RIM is still a leader in the enterprise smartphone market, thanks to the rock-solid security systems and corporate tools BlackBerry offers.

However, RIM is a one-trick pony and with rivals looking to catch up sooner than later, it is high time that RIM steps outside its limited business framework and adopt a better strategy or die a painful, slow death.

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