Warner Music Group has confirmed that Jason Flom is out as chairman/CEO of The Atlantic Records Group 17 months after he was named to the post.

NEW YORK -- Warner Music Group has confirmed that Jason Flom is out as chairman/CEO of The Atlantic Records Group 17 months after he was named to the post.

Craig Kallman -- formerly co-chairman and COO of the label -- is named chairman/CEO of Atlantic, reporting to Warner recorded music chief Lyor Cohen. Julie Greenwald remains in her role as president, reporting to Kallman.

In an internal memo to the Warner staff, recorded music chief Lyor Cohen called it his "sad duty" to announce Flom's resignation, describing him as "not only one of the industry's most talented A&R men, but also one of its leading entrepreneurs" who played a "critical role" in the restructuring of Atlantic.

In conjunction with Flom's departure, Flom's imprint Lava Records -- a joint venture between Flom and Atlantic -- becomes a wholly owned subsidiary of Atlantic.

Sources say there may not be a cash buyout for Lava -- control of Lava in the event of his departure is believed to have been worked out upfront when he negotiated his deal to become the head of Atlantic.

Flom was part of the initial management team assembled by Edgar Bronfman and Warner Music Group's private equity investors in the wake of their acquisition of the major label.

Some company sources suggest that the company designed an admittedly unwieldy management structure at the top of Atlantic with the aim of creating stability in the wake of a dramatic restructuring of WMG's east coast operations. But with the restructuring now complete, Atlantic's structure of co-chairmen and a president left the company top heavy.

"The management structure was not proportionate to the streamlined nature of the company," a WMG insider says.

Despite key releases this year from Rob Thomas, Missy Elliott, and Fat Joe, Atlantic has been largely hit starved as it has worked through its restructuring efforts.

Hopes are running high for a second half release schedule that includes music from Death Cab For Cutie, Lil' Kim, James Blunt, and Sean Paul among others.

Flom -- a 26-year Atlantic veteran whose A&R credits include Sugar Ray, Kid Rock, Tori Amos, Simple Plan, Skid Row, Twisted Sister, matchbox twenty and The Corrs -- was recently tapped by the T.J. Martell Foundation as its 2005 Humanitarian Award winner. He will be honored Oct. 6 at the foundation's 30th anniversary gala at the Marriott Marquis in New York.

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