Image processing is done in "Hardware" or "Software"

I am no master, but i'll have a go of explaining.

Using software requires some hardware running as a generic cpu (i.e. a Nios). Because the Nios has to be flexible in its calculation abilties, it takes many more cycles to complete an operation.

Rather than having this supplied hardware (nios), you can make your own dedicated hardware using HDL. Your HDL will be able to operate at much higher speeds since it does not have all the unesceaary overhead.