"Today in Semmering , Austria"

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Has anyone ever seen a rail fail like this before?

I can't tell what's going on for sure from the photo. However, I see a weld on the left side of the fracture. I'm going to guess it's a thermal induced stress fracture from the welding.

I think you're right, Bob. You can see a bit of rust bleed just to the right of the weld. That'd be where the horizontal crack started. Once it really starts to go, those cracks can propagate really fast. That's a pretty big one. Good thing the guard rail is there.

If you look closely at the left side of the photo, you'll see that the "rail" on that end of the break is actually the end of a cast steel frog.  There's also a guard rail alongside of the rail in the background.   Hence, this image is in a turnout, with the switch out of view to the the right and the frog just out of view to the left. 
 
As a trackwork engineer, what I find most interesting is the weld between the toe of the frog and the closure rail.  The frog is almost certainly made of cast manganese steel while the rail is most likely plain carbon steel.  You cannot weld manganese steel frogs to carbon steel rail by thermite welding due to the different chemistries of the two.  But you can make an electric flash butt weld in a fabrication shop, using a proprietary process that places a slice of stainless steel between the two.  Hence, the failure might be due to a quality problem in that flash butt weld.  

Naturally, there's some element of speculation in the above.  Nevertheless, I'll also note how this derailment occurred in Austria, which just happens to be the home base of the international trackwork fabricator that owns the patents to the aforementioned proprietary welding process.  I'll circulate this photo to my professional peers to see if any more information surfaces. 
 
/s/   Larry
Lawrence G. Lovejoy, P.E.