Watch The Fall of the Habsburgs Full Movie Free Online 123Movies. The Habsburg Dynasty had ruled large parts of Europe and the world for 650 years. During World War I, however, the mighty Austro-Hungarian Empire sowed the seeds of its own demise. At the height of World War I, the world of the Habsburgs was on the brink of collapse. Almost exactly 100 years ago to the day, in April 1918, the most sensitive diplomatic mission of the First World War became a Europe-wide scandal: the so-called "Sixtus Affair". Secret negotiations between the Austrian imperial family and France were supposed to bring peace to the Danube monarchy – and their failure caused the war to escalate and the Habsburgs to fall.