Should mention that the kid was actually suspend from school over the incident. I gather it was regarded as a very big deal and the school came down very heavy on the kid.
The trouble for him with respect to getting into colleges is that (A) you are asked about whether you have ever been subject to academic discipline in your applications; (b) instances of academic discipline are reported in counselor's reports I believe. But you are also giving a chance to explain yourself. Not sure what a kid can say, except to be very, very contrite, and talk about lessons learned, that would make a highly selective college or university of the sort this kid was aiming at even want to overlook this kind of thing. The kinds of schools we are talking about turn down just about everybody who applies anyway. So there pretty likely to turn down a kid caught cheating.
(The parents, by the way, were floored by this. But they aren't mad at the school. I gather they are furious at the son -- especially his "but everybody does it attitude.")
Zero tolerance may not be exactly the right answer -- kids do make mistakes, exercise poor judgment, are too often immature. We should use every opportunity we can to help them overcome mistakes, mature, exercise better judgments. But I think schools and universities really do need to come down very hard on cheating. They can't possibly allow themselves to send the message that a little bit of cheating is alright now and then. I If they do that, they will have an awfully hard time drawing a line. Plus it is utterly at odds with what they stand for and the values they espouse -- especially university, where the integrity of scholarly and scientific work is their stock in trade. They can't allow a culture in which that integrity is undermined even one bit. And I don't think it's nearly enough to say if you get caught cheating on an assignment, you take your F and you let the grade fall where it may. That's pretty minimal and probably not nearly enough to discourage students who simply do a cost-benefit analysis. The point is that cheating isn't just a "local" offense against a particular teacher, it's a violation of the fundamental values that govern all academic institutions at all levels.
I admit it's a very delicate issue -- especially when you throw in the propensity of some big time athletic schools to grease the skids for the athletes the way UNC Chapel Hill did. But that's a whole other can of worms.