It's kind of difficult. :-)

First, yes, academic titles are actually part of your name by law, which is extraordinarily weird. It's in your passport, in full abbreviated form, designating the faculty. (Like "Mag. phil." or "Dr. rer. soc. oec.", etc. I involuntarily checked into various hotels under the first name "Phil", because of this.) On the other hand, there are those who actually use a title in everyday life, even insist on it being used, and those, who merely ignore it for the most (reserved for interaction with potentially hostile bureaucracy, etc.) Using a title as an author is obviously a no go (with the probable exception of MDs), but it may happen. (A useful hint to not to buy a book.)

Rather recently, we have even seen an inflation in academic titles, starting with commercial schools being upgraded to universities and their titles becoming academic titles, as well. Applied universities were rolled out at scale with titles first marked by a distinctive appendix "FH", which was later allowed to be dropped, for it having been perceived as a stigma. There's now a movement to grant masters of trade automatically the academic title of master.

Then, there are bureaucratic and occupational titles, carefully chiselling out the exact position in the hierarchy, which enjoy frequent use in addresses of all kind. However, these are merely ornamental and are not part of your name.

Lastly there's a third, highly ambiguous category, which is probably the most famous one, being the titles of "Professor" and "Hofrat" (Court Councillor), granted by the federal president. So Professor may be someone with habilitation and occupying a sede at a university, or it may be a merely honorary title, for the most reserved for celebrities of the cultural field, e.g. opera singers arriving at a certain age. Likewise, Hofrat is used in some parts of the country as a bureaucratic title on the federal state level ("wirklicher Hofrat", coming with its own pay grade), but its also a honorary title reserved for high ranking civil officers as some kind of no costs gratification for lifetime achievements, just before the transformation into a Lipizzaner as the final apotheosis. (There's also a complementary "Kommerzialrat" for ageing dignitaries of the commercial field. However, as this is quite unambiguous, it's also considered of slightly lesser interest.)

(Quite opposed to this, any medals of honour are never yours, considered just on loan, and are expected to be returned in the case of your death. You're even prohibited from wearing them, with the exception of a few, regulated events, like the Vienna Opera Ball.)

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Edit: As a more serious explanation, Dr was the sole academic degree for almost all of the time and it was only granted by universities proper. It was only in the 1980s that a new academic system was adopted, introducing the intermediary degree of Magister, which came at sometimes three times the effort as compared to a doctorate in the previous system. So it was recognized as well, but with mixed reception. Meanwhile, we switched to the PhD system with an even more inflated system of titles, associated with varying degrees of esteem, use and general recognition.