Nightglow we also had a very similar issue with our ds who was 14 at the time. He sent a naked pic of himself via text to a girl and she sent him one of her too. During the night one night, he woke me up and asked if we could chat about something. He was in a state. What has transpired is that some of the boys at school got hold of his phone and saw the pics. They then started to bribe him, and he had to pay them money each day, and if he didn't, they claimed they would show me the pics and put them on the www.
What he thought was just one picture that would be looked at once and then deleted, didn't work out that way. As we as adults know, but he just didn't realize the consequences of what they had done. The girl was only 13 ffs!
Anyway cutting a long story short, he broke all contact with the boys who did this, and with the girl. I didn't ground him or punish him, as i really honestly think once he realized what had happened, that he learned the consequences himself. From time to time thereafter i would ask to see his phone randomly, he never had anything dodgy like that on there after that.
I do think you need to sit down and have an open discussion about this with him. They really do not understand the consequences of this, although at this age they clearly think they know everything about everything 
Just to add, it is quite normal for a 14 yo boy to be interested in naked pics of girls etc, but with technology these days it is so very different. Its not like they are going into the corner shop and buying the girly magazine off the top shelf and all huddling around looking at some boobs. Its just a message here and there asking girls for one, and they are so willing to send them. That's what bothers me the most, is that the girls are willing to do it 