It's definitely an epidemic, but I don't believe that stopping sleepovers, taking away cell phones, or completely restricting activities is the way to go. A lot of it depends on the company that your kids surround themselves with, and it is your job as a parent to make sure that you not only know your kids friends, but also know their parents.
I have two teens and two tweens, and they are surrounded by this every day. I know their friends, I allow the girls to have sleepovers with a few select friends, but they are not unsupervised. That's right - if the girls are having a sleepover, mom gets to attend too! We all sleep in the basement, watch movies, and make snacks and I do henna and occasionally their hair and makeup. I haven't had too many complaints yet.
Sports are probably the MOST EFFECTIVE way to keep your kids out of trouble. Kids who are playing sports, especially on the traveling teams, do not have time to get into trouble, especially if they are busy working on maintaining their GPAs. Almost all high schools have mandatory drug testing for athletes, so I have a hard time believing that these kids are doing drugs in the locker rooms.
My younger ones do not have cell phones. This edict is currently "ruining" my 14 year olds life. However, they do not need a cell phone. I drop them off at school in the morning, their brother picks them up at the end of their activities, and I expect that the will be at school during the day. If they are not, the school will call me and let me know. There is absolutely no reason for most kids to have a cell phone, period, which immediately puts the kibbosh on sexting.
Finally, and most importantly, homework is done at the kitchen table, and the laptops do not leave the kitchen or living room. There is no reason for anyone to have a laptop in their bedroom. No one has pressing homework that MUST be done after 11:00 p.m., which is when hubby and I go upstairs. If they do, they can come to my room and hang-out with me. I also have net nanny on the computers and all passwords. If you change a password without giving me a new one, you are grounded from the computer for two weeks and get to spend more "quality time" helping mom and daadi around the house.
My restrictions occasionally drive my kids up the wall, but it's working for us so far. We'll see how it goes when choti is a teen, she is the one who most loves to push the limits.