In 1988 "E.T.: The Extra-Terrestrial" sold 12.5 million video cassettes even though it wasn't released until October, becoming the all-time top-seller and almost quadrupling the 3.2 million copies of former champ "Lady and the Tramp."

Overall it was a blockbuster year for home videos, grossing between $7 billion and $7.5 billion in retail sales and rentals, according to Tim Baskerville, publisher of Video Marketing Newsletter in Hollywood.Four years ago movies were grossing more at the box office than video sales and rentals. Last year's box office gross from movies was about $4.3 billion.

Baskerville noted that "1988 was a very strong year, with `E.T.' and `Cinderella' helping a surge in the fourth quarter that wiped out early '88 talk of slowing sales."

He attributed the high numbers to lower prices, wider distribution, more advertising and the fact that now more than 60 percent of American TV households have VCRs. Baskerville, whose newsletter generates video-sales lists, predicts an even better 1989. "We're still on a growth curve," he said.

For Disney Home Video, "Cinderella," also released in October, scooted to the No. 2 spot on the all-time list with sales of 7.2 million, more than doubling the old mark of "Lady and the Tramp."

And so long as there are children and grandchildren who have birthdays, that number figures to roll upward before Disney pulls this tape off the shelves at the end of April.

Disney-Touchstone placed 10 of its 1988 releases on the list of 21 videos that sold more than 350,000 copies last year. For Disney, the studio revenue, or wholesale value of those 10 videos, was $232.8 million.

That was 42.4 percent of the $548.7 million generated by the top 21. "E.T." was the only MCA release to make the list, but it was worth $187.1 million, accounting for 34.1 percent of the pie.

Disney-Touchstone has 38 of the 105 titles on the "Top 100" list (six titles tied for No. 100), 31 percent (32.6 million units worth $598.9 million) of the $1.9 billion these releases have generated.

Paramount is second with with a 21 percent share on 20.6 million units generating $410.7 million, while MCA is third with a 14 percent share on 15.5 million units generating $264.1 million, all but $77 million from "E.T." Warner is a distant fourth.

An interesting note is the pricing of the biggies, in the under-$30 range. The top list price for "E.T." was $24.95. For "Cinderella" it was $29.95, although there were a number of special discounts and rebate deals. "Good Morning, Vietnam," No. 3 for the year and No. 5 on the all-time list with 2.2 million cassettes sold since its August release, topped out at $29.95.