Yes, phones used to have hooks. They were there to hold the earpiece.
“What’s an earpiece?” you ask. Remember old movies where people held a bell-shaped thing to one ear while shouting into a cup-shaped thing on a boxy phone hanging on the wall?
Well, the bell-shaped thing is the earpiece. Anyway, if someone’s earpiece was left dangling off the hook, either by accident or because he didn’t want to get any calls, other people couldn’t get through to him.
After the call, people would literally “hang up” the earpiece on the hook, giving us another anachronistic term we still use today.
Although handsets have replaced earpieces and cradles have replaced hooks, our basic phone terminology has changed very slowly.
Which is why we still “dial” phones in order to make them “ring” on the other end, even though phones almost never have either dials or bells anymore.