I think it would treat the value as 0 here. 

> If applying the algorithm to convert a string to a number to the string given by the element's value does not result in an error, then let value be the result of that algorithm. Otherwise, let value be zero.

http://www.w3.org/html/wg/drafts/html/master/forms.html#dom-input-stepup

So it could possibly be value == "00:10" in the end here? Someone really familiar with this might want to take another look. That's how I read it on a saturday at least ;-)