Franz Joseph I of Austria
If Greater Germany was to prevail, the crown would necessarily have to go to Franz Joseph, who had no desire to cede it in the first place to anyone else. On the other hand, if the idea of a smaller Germany won out, the German crown could of course not possibly go the Emperor of Austria, but would naturally be offered to the head of the largest and most powerful German state outside of Austria—the King of Prussia. The contest between the two ideas, quickly developed into a contest between Austria and Prussia. After Prussia decisively won the Seven Weeks War, this question was solved; Austria lost no territories as long as they remained out of German affairs.
Austro-Italian ironclad arms race
Tegetthoff's successor to the office of "Marinekommandant" was his old political rival, Friedrich von Pöck. While he commanded the ship-of-the-line "Kaiser" in the Second Schleswig War, Pöck had been given shore assignments throughout the Seven Weeks War, denying him the same sort of fame and public admiration that Tegetthoff had enjoyed after the Battle of Lissa. Almost immediately after taking office, Pöck faced chronic budgetary problems, owing in large part due to obstructionism from Hungarians and liberal Germans within the Austro-Hungarian government, the former viewing naval matters as an Austrian concern, and the latter opposed to naval expansion in light of the continued deterioration of the Regia Marina following the Battle of Lissa. Additionally, since he was not involved in Tegetthoff's victory at the Battle of Lissa, he lacked the personal prestige to command the respect of the government, which Tegetthoff had successfully used to secure the construction of four ironclads in the four years since the Seven Weeks War. As a result, Pöck had great difficulty securing the funding for new ironclad warships during his tenure.