Austrian railways run as they did in OTL. Some two thirds of the "big gauge" lines in the Crown Lands are State owned, the rest are private. Up to 1903 the gauge was 4' 8 1/2", with a change towards Imperial Gauge 5' starting in the second part of that year. This being due to booming trade with Russia and other considerations. Private owners were encouraged to switch to 5 feet as well. The dominant narrow gauge is 2'6" (760mm/762mm), and there is some pressure for all narrow gauge operators to switch to it.

Overseas:
- Catanduanes is being connected by causeway to the Luzon network of 3'6"
- Malta has some military and industrial tracks of 60cm gauge
- Aden - there is a 2'6" line to the Lahij military camp
- Alhoceima has no RR

The extensive flooding following the Long Harsh Winter of 1903-1904 caused extensive damage to the rail network.
The 1904 reconstruction and repair was an excelent opportunity to complete the gauge change. Private operators were eligible for state assistance in recontruction of their facilities only under such a conditon. Thus now 5 and 2'6 feet gauges are almost universal across the Habsburg lands, with only a few narrow gauge holdouts on private lands.
In 1904 and 1905 the Siebenburgen Militaerisch Eisenbahn (Military Transylvanian Line) was built, which involved the expansion of some existing lines to double track, as well as some links built from scratch. Now there is a double track Imperial Gauge line running like a letter "V" along Transylvania's borders.

Upon Habsburg takeover in 1904 Parana and Santa Katarina had two unconnected systems, both in one meter gauge.
From autumn 1904 onwards, extensive rail expansion has began, partly by Austrian firms, and partly by outside contractors, chiefly from Argentina. The exisiting lines are relaid to Imperial Colonial Gauge, 3'6 (1067mm). The separate Santa Katarina and Parana networks are being connected, with one line along the coast, and two more through the mountains. Three paralel lines are being pushed towards the Parana river, with the connections making the network look like a net.

The 300 miles of two foot (60cm) Decauville system tracks laid by the military during their anti-Anuhuac operations are being snapped up (i.e. stolen) by colonists and enterpreneurs alike. The same goes for the 100 miles of erroneously delivered 18 inch siege artillery tracks.

Overal, the plan is to build some 3000km, of which some 1000km will be through mountains, the rest on the plateau.

Due to military intervention in planing, the Paranagua-Imbituba littoral line offers few vistas of the Atlantic Ocean - the army people insisted on the track running at some distance from the coast.

Ahoj!
Paranese RR at end of 1908.

Thick grey lines are inherited from French, and black lines are Austrian built. The two thick red lines are military 2 foot lines.

Parana RR update - early 1912:

In the second half of 1912 the Parana network began regauging to 3'3". This was brought about by acquisition of Rio Grande, and growing economic integration with Brasil.

Thus South America seems to be destinied to have several discrete networks:
- Brasil, Parana, Uruguay - in 1m/3'3"
- Gra Colombia - in 3"
- NUSA - in 5'6"