It does seem like there could be a breaking point.
Are they really going to stick to treating everyone to the same perks? The ones they use to compete for engineering talent in Palo Alto?
I would keep it up if it up to me, knowing that the cost is a long-term investment in internal corporate identity. Once you cut back on these things (such as Microsoft's formerly-gold-plated health plan) you've permanently become a more ordinary company.
$20 per employee per day doesn't seem like such a huge expense, especially compared with salary and office space. If it makes employees happy to stay at the office longer, it's not a bad plan.
> Consistently high-quality food, available that conveniently, is a primal attraction.
It also ensures that the employees won't leave the office premises for the lunch break. That could be a good thing (for the employer) or a bad thing (for some of the employees).