The final year of the 1970's was unkind to the music industry, particularly the classical music industry. It was a year in which RCA made substantial reductions in recording projects; the giant Polygram combine absorbed financially troubled London/Decca; Capitol abandoned its EMI Imports division; HNH cut back dramatically and gave up its distribution to Euroclass; and Warner Communications topped them all by firing virtually the entire staff of Nonesuch Records, ending an era and placing in doubt continuation of the honorable traditions established there by Tracey Sterne. On the positive side, numerous smaller outfits, especially those dealing with imports and reissues, continued to show signs of health. One of the most intriguing catalogues of imports continues to be maintained by the German News Company (218 E. 86th St.; New York, N. Y. 10028), which has a large stock of unusual German and Scandinavian recordings, and which now is the only major American source for EMI discs. Qualiton, with its well-developed domestic distribution system, offers not only the familiar Supraphon and Hungaroton labels, but also English imports from Pearl, Royal, and Aurora, and the excellent releases of Swedish Bis. Quintessence continues to thrive as a purveyor of important reissues, while pop leader MCA, which last year bought ailing ABC Classics, has begun in a modest way to restore the best of the American Decca catalogue, a task it shares with Varese Sarabande. Best of all signs is the emergence of new labels, and as we welcome Caedmon's Arabesque Records, launched early this year, we are cheered also by the prospect of a new imprint from the resilient Ms. Sterne—perhaps the most auspicious sign of all for the 1980's.