[Bhavin Acharya] My my point of view, DSM brings collaboration, transperancy and raise impediment among the developers. It is a development team meeting, not for anyone else.
But Agile is not all about prescription but it should be adaptation whatever working for a team. At the end, Agile principle and value should be maintained.
Now, as question said, developers are doing collaboration whole day(1-1 or in team) then let allow them to tailor the process and Scrum master should be watchful, pick the incident to coach the team to make them understand value of Daily Scrum. Also have healthy discussion during retrospective how to improve process to maintain discipline and benefits of daily Scrum.

[Assaf Stone] I’d say that the daily scrum is an event, not a ceremony.

The point is to inspect and adapt the plan for meeting the sprint goal, on a daily basis, spending no more than 15 minutes doing so.

If it doesn’t happen in a formal meeting, I couldn’t care less.

The only thing I would discuss with the developers is whether or not they feel they are as effective as they can be in their work, and figure out together how they can improve, if they are not.