On pandora.com/newpandora it says "The front-end technology has been rebuilt in HTML 5" but doesn't mention anything about the actual playing of the audio.
The whole point of HTML5 tags like <audio> are to make content completely open. Unfortunately, that's the exact opposite of what what any major record label wants. I'm pretty sure they'll use flash in the background to play the audio, even if the entire site all the way down to the progress bar are HTML5.
