I personally think that bullying has become far more personal, far worse, and far too often.  As others said, in most cases, bullying would occur in school or right around school or school events but you were somewhat isolated outside of that.  Now you get it 24/7 and it's far more public with all of the social networking sites, chat, text, email...etc.  
I was bullied a lot in school.  Not physical because I was mainly bigger than most kids.  However, I was tormented mentally for many reasons.  One of the more popular being that I killed my best friend, or that my family were killers.  Why?  
Because when I was 11 my sister slid on ice and hit and killed a classmate who was walking on a road and not on the snow-covered sidewalk.  3 years later I was bike riding with my best friend and he turned into traffic and was killed.
Kids loved the "killer" one.  They'd make up all sorts of things, like saying I killed him for his baseball cards.  They would slide pictures of his face, (markered with blood) which was published in remembered in the yearbook, into my locker, with "killer" on top.  
When my parents complained to the school, the principal had the other kids' parents in, they all blamed it on "kids being kids" and laughed it off.
This is where the real problem lies.  Kids by their very nature lack empathy and capacity to understand their effect on others.  They simply cannot morally understand how things they do affect other people.  That's because they are young and haven't experienced all sides of tragedy.  Thus, parents should be the ones who supply that example.  However, most parents aren't willing to punish their kids or help them develop empathy.  However, now parents are "friends" or are too busy or don't care about developing their kids properly.
http://www.myfoxdetroit.com/dpp/news/the_edge/dying-girl-taunted-by-neighbors-in-trenton
This can be developed by kids but it is far more rare and usually those kids have developed with some family adversity themselves.  For example, I know many examples of kids who had siblings with down's syndrome.  In all of the cases I know (hardly statistically valid) the siblings all seemed to be far more accepting of differences and far more caring towards others.   
Add the lack of empathy to the leverage modern technology provides.  Not only can people be mentally cruel at school (which is the far more common form of bullying) but they can now be mentally brutal 24/7 across all spectrums of social media.  Add this to the fact that the message can not only be delivered more often, but also far more widespread.  Whereas prior bullying was localized to a small area of effect, now hundreds, if not thousands, of people can see it in a single post.  That has to be humiliating and deeply unsettling.  
To the internet toughguys who sit there saying that kids aren't "tough" anymore, I'd love for you to be subject to 24/7 torment by your supposed peers.  I'm sure you wouldn't be "tough" for too long.