To expand a little bit, the -p flag tells perl to wrap the whole script inside a:

whie (<>)
{
  # ... your code
  print $_;
}
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The -i.orig tells it to first rename the original input file to its old name followed by .orig, then run the script and put its output into a new file with the same name as the input file.

I suspect the code snippet you started off with assumed you were running under perl -p.